Shortly after Malusi Gigaba delivered his interim budget speech in parliament, the rand tumbled by two percent and reached its lowest level in ten months.
It was the market’s quiet but damning response to Gigaba’s reason.
He received very little worthy response about his speech. On the contrary, he was accused of using many words without saying anything; Did an academic say that if it were a student honeymoon deal he would not have passed and economist Dawie Roodt said Gigaba had read figures while it was clear that he had no idea what he was talking about.
Gigaba admits that the country is experiencing an economic crisis, but he has no proposals or plans to resolve the crisis.
In light of this, Dr. Pieter Groenewald of FF Plus said, it is difficult to see how junk status can be avoided by the end of the year.
Dr. Groenewald said that the minister mentioned the critical problem, namely weak economic growth, but then said nothing to create confidence in the country’s economy and attract investors to the country.
“It is of the utmost importance to attract investors to gain economic growth. Unemployment in South Africa is currently 38 percent. It puts tremendous pressure on existing taxpayers and the treasury because services need to be provided and there is no money for them.”
“Only the interest on South Africa’s debt is currently R163,3 billion. And the forecast is that it will be R223,4 billion by 2022, measuring a total debt of about R1 trillion. This is a million trillion rand. It is a huge debt burden.”
“Therefore, the FF Plus does not doubt that taxes and personal taxes will be increased in February next year. The taxpayers need to prepare for substantial tax increases. The FF Plus said it is unfair to milk the taxpayers who are already heavily burdened so that they have to see how their money disappears in a bottomless pit of theft and corruption.”
“The minister acknowledges that he is concerned about the high incidence of tax avoidance. However, he does not have to wonder why this happens. People who see that their tax money is not properly utilized will try to pay as little as possible.”
“Referring to the problems with state institutions such as the SABC, all the minister can say is that a new board has been appointed. He offers no workable plan to address the real problems. The latest figures indicate that treasury provides guarantees for government entities’ debt, which now amounts to R445 billion.”
“No country can succeed if its people are totally overburdened just to pay the excessive public debt,” said Dr. Groenewald.
Read the original article in Afrikaans on Die Vryburger
South Africa Today – South Africa News
