‘Godongwana’s hands are tied with respect to taxes’

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Economist Frank Blackmore says the country’s tough economic situation will make it difficult for Finance Minister Enoch Godongwana to deliver a budget that is satisfactory to all.

The business sector has called for a balanced medium-term budget policy statement that will champion the country’s efforts to reduce the country’s debt burden.

Godongwana will deliver the policy statement in Cape Town this afternoon.

Blackmore says it will be interesting to see how Godongwana will strike a balance.

He says, “The main issue is going to be how we are going to close the deficit, what are we going to do there, are we going to increase taxes, are we going to borrow more, are we going to go to our contingency fund, are we going to cut costs.”

“The Minister’s hands are tied with respect to increase in taxes given that next year is an election year and the fact that we are quite highly taxed, borrowing is becoming more difficult which leaves cutting costs and perhaps the contingency fund to bridge the gap between spending and the revenues.”

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