Finance Minister Enoch Godongwana will take another shot at delivering his Budget Speech on Wednesday, 12 March, following its rejection in February due to a proposed two-percentage-point increase in value-added tax (VAT).
The revised budget is expected to address concerns over taxation and government spending.
Speaking on VOC Breakfast, economist Ulrich Joubert highlighted that VAT remains the most pressing issue, as South Africans brace for potential tax hikes or austerity measures to balance the national budget.
“We must expect some tax increases. A VAT hike of 0.5% to 1% is likely because the government is searching for additional revenue,” Joubert explained.
He added that individuals may feel the financial strain as salary increases could push earners into higher tax brackets, leading to greater personal tax contributions.
Additionally, the so-called “sin taxes” on alcohol and tobacco are expected to rise significantly.
“There’s also hope that fuel levies won’t be increased, but there is a real possibility that they might,” Joubert warned.
Beyond tax adjustments, Joubert emphasized the need for the government to curb excessive spending, stating, “As an economist, I’d like to see the government take serious steps to cut expenditure. This is extremely necessary.”
Listen to the full interview below:
VOC News
Photo: TreasuryRSA/X
