Fix the economy
MALUSI, you dress and speak well. However, your spell at Home Affairs makes it difficult to inspire confidence, when we consider the visa debacle that cost the country dearly in terms of lost tourism revenues.
You didn’t listen to advice then, and had to backtrack when it became apparent that what you had been warned about had come to pass. Are you open to some suggestions now?
Your budget speech last week was more notable for what you didn’t say. You don’t have to tell us that SA Inc is failing. We know that, with parastatal bailouts costing the fiscus (taxpayers) billions of rand, seemingly every other week. You should have sketched visionary plans to get us out of it.
Sadly, there was nothing at all along these lines other than hackneyed generalisations like transformation, but nothing about how this is to be achieved. To misquote Shakespeare, who so eloquently put it, “It is a tale, full of sound and fury, signifying nothing”.
The R50 billion budgeted tax collection shortfall for this year is very worrying. But the Zupta looting is said to have cost South Africa R100bn so far, and it seems as if the Zuptas are hell-bent on boosting that figure before 2019. Only you, Malusi, know if you are complicit in this shameful abuse of power and rampant looting.
It is true that most business is controlled by a handful of companies. Perhaps you should thank those capitalists who run businesses with millions of employees and bring in billions of rand of company and personal income tax to the fiscus.
Where would you be without them? Yes, the benefits of growth must be fairly spread, but for that to happen, don’t we need growth of more than 0.7% a year? Has there been any meaningful growth in the last eight or nine years? I feel that 2030 is too far in the future and that we need five-year plans.
So where to from here? For a start, put SAA up for sale to another airline that can run it efficiently, show profit, and pay tax on that profit. Similarly privatise Eskom, PostNet and Transnet.
Get rid of the minimum wage, the biggest culprit in keeping people out of work. Surely a low wage is better than no wage? Upskilling over time can improve employees’ take-home pay, so a skills training programme is imperative.
Then increase VAT by 1% a year for the next six years. Zero rating of foodstuffs and other basic items will protect the poor. This would translate into a 7% VAT increase, every year, for the next six years.
Put the VAT at 25% for luxury items (cars more than R500 000, with caps on TVs, cameras and non-essential luxury items).There will be plenty of money to provide housing, infrastructure and skills training for the needy.
Incentivise smaller families. Surely it is obvious that parents with five children cannot feed and educate their children as well as a two-child family? A slower population growth rate will also take the pressure off the rate of increased provision of services and infrastructure growth.
It’s a disgrace that one third of our population have to survive on social grants.
If Germany could rise out of the wasteland that was Germany in 1945, to become an economic giant in just 15 years, why can’t our country, with all its infrastructure, financial institutions and its diverse people, also prosper with a little vision and application?
Over to you, Malusi. Are you up to the task? Gavin Hillyard Somerset West