The Democratic Alliance (DA) is opposed to possible tax increases when Finance Minister Enoch Godongwana tables his Budget Speech later this week. The official opposition says any proposed VAT increases by National Treasury, punted to be between a percent to two, must be put on hold as this would impede growth and affect the poor.
The party presented its alternative budget to the media earlier on Monday.
The DA has presented its alternative budget in a bid to nudge the finance minister to take up their proposals. At a macro level, the party wants Godongwana to reign in debt and strengthen structural reforms to the economy that lead to growth and job creation.
The party also wants consumers and businesses alike to be cushioned against tax increases.
“It is very clear that if government manages our monies effectively, we do not have to increase taxes and you do not have to compensate for fiscal drag either. So, we believe that South Africans have taken enough pain and enough punishment by a government that is simply unable to manage and spend its money wisely and that is why we have been very emphatic around our tax increases,” says DA MP, Dr. Dion George.
Fresh from the national manifesto launch, the DA claims it can save the country hundreds of billions of rands by discontinuing some ministries, the National Insurance Fund and the National Youth Development Agency among others.
The party also wants reforms in the manner the National Student Financial Aid Scheme is governed.
“The DA alternative funding model will be tiered systems for loans and grants with a primary focus on providing substantial funding to students hailing from low-income households. The DA’s proposed system for loans and grants primarily targets students from economically disadvantaged backgrounds. It introduces an array of government loans with lenient repayment terms and transition loans to bursaries based on academic performance,” George added.
The DA has also reiterated that it expects no bailouts for state-owned enterprises.
“The reality is that this government cannot continue to delay the inevitable collapse of many SOE’s and the misplaced hope that they will spontaneously self-correct and fund themselves somehow from the balance sheet. The immediate course of action should be to introduce public-private partnerships as a precursor to privatisation. Failure to act now by opening up the sectors to private investment will keep the country locked in a indefinite low-growth trap,” says DA MP Ashor Sarupen.
The official opposition says the focus should be on attracting foreign direct investments as well as scrapping race based legislation like BBBEE.
