Praise for tax collection — but little else
Nafcoc gives Godongwana's MTBS a three out of ten for entrepreneurs, infrastructure and employment
The biggest surprise from finance minister Enoch Godongwana’s Medium Term Budget Policy Statement on Wednesday was the huge increase in tax collection.
This was from Gary Mclean, a partner at East London’s Charteris & Barnes, the accounting and business consulting firm, who added: “Whatever Sars commissioner Edward Kieswetter has done it had a better-than-expected revenue collection, with an estimate of R83.5bn.
“It is a fantastic effort, and it seems that the tax fellows are back to their best under his reign.
“However I’m not sure how sustainable it is because much of the success is due to the mining boom.”
Mclean was concerned that Sars had focused on taxpayers that were already “in the net” and were easy targets.
“I would like them to focus on those who are avoiding tax. A simple solution would be for any people forking out over R1,5 bn on a flash car being forced to provide a tax certificate.”
He felt that with civil servants salaries accounting for 75% of the expenditure sustaining this would be hard, and the knockon impact would have serious consequences.
Chwayita Zituta, Nafcoc EC president, said that several of the announcements in the MTBS did not sit well with her business chamber.
She said bailing out Eskom and hints that several more state owned enterprises would also be assisted could be directly interpreted as more taxation for SA entrepreneurs, as taxation on the increased expenditure was bound to soar.
“Our biggest problem is Eskom. To keep funding it is not helping. The load-shedding is causing great harm to our members and unless the government can do something about it we are going to see many more companies closing.”
Another issue that troubles
Our biggest problem is Eskom
Nafcoc members was Godongwana’s comment that the public servant sector was unlikely to receive more than a 3% wage increase.
“Can you imagine trying to fight load-shedding, as a small business, and on top of that getting no services from government and the municipalities?
“The unions have already put the government to notice regarding their intentions to declare a national strike.”
She said a poll among several economists on Safm had rated the budget between three and seven out of ten.
Nafcoc’s view, she said, would be more in the region of three. Nafcoc’s thoughts on the various grants are that while keeping people sustained is understandable, it would be far better to incentivise entrepreneurs by lowering taxes, providing more money for infrastructure developments and introducing rebates on every employed person, which would all lift employment.
Gordon Thompson, general manager of ISRI, the commercial vehicle seat manufacturer, with a head office in Germany, said that as an East London manufacturer, the budget was weak and unimpressive.
“With load-shedding hammering every business, and sending many to the wall, I would have expected far more concrete plans as to how Eskom could be bolstered by other electrical sources and how rebates could stimulate clean energy.”
“Border-kei Chamber of Business executive director Lizelle Maurice said that the paucity of detail on how to skill the youth would indirectly add to this state of joblessness.
“While entrepreneurs are touted as one of the main job creators they cannot continue to play the role of trainer. Mercedes-benz Learning Academy produces job-ready graduates that can immediately slot into their trade or line jobs,” she said.
“The chamber would like to have seen much more money pumped into practical education facilities.
“SA is desperately short of competent teachers, nurses and artisans.”