Mixed reaction to budget

By Drum Digital
25 February 2015

Finance Minister Nhlanhla Nene should have looked at cutting corruption instead of raising personal income tax, opposition parties said in Parliament on Wednesday.

Speaking shortly after Nene delivered his first main budget, for 2015/16, African Christian Democratic Party MP Steve Swart said the tax increase was unfortunate.

"We understand the need for the fiscal consolidation path, but if the citizens are expected to pay more taxes, surely they can expect the lights to stay on, water to flow, and potholes to be fixed -- and clearly there is no guarantee of that," Swart said.

"To address the fiscal consolidation path, the minister should rather have looked at corruption, which is estimated to reach R30 billion per year."

Freedom Front Plus leader Pieter Mulder agreed, saying government was failing to balance its books.

"It's a sad day in the sense that for the first time in 20 years the personal tax is up with one percent," Mulder said.

"If they must increase taxes, why don't they increase VAT? Because now you are targeting a very small group of taxpayers, killing the cow that gives the milk at the moment."

The financial packages offered to the country's state-owned enterprises did not bode well, Mulder added.

"SAA and Eskom are not forced to be independent, like naughty children getting money every time from their father."

The United Democratic Movement's Nqyabayomzi Nkwankwa said increasing taxes to raise revenue was a bad idea when government still had not succeeded in cutting wasteful expenditure.

"You can't increase taxes when you haven't given us a report to say if the cost cutting measures you put in place in the past yielded any results," Nkwankwa said.

ANC secretary general Gwede Mantashe was more upbeat, saying the budget spoke to the ruling party's objectives.

"We promised in the state-of-the-nation address we will allocate the money in the budget -- that the minister will come add details," he said.


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