Cosatu wish list targets wealthy

ECONOMIC TRANSFORMATION A PRIORITY Federation calls for no increase in VAT or income tax for lower earners

The Congress of South African Trade Unions (Cosatu) said yesterday that it wanted this year’s budget to be dedicated to radical economic transformation and to be in sync with the resolve of the African National Congress (Sona).

Minister of Finance Pravin Gordhan will be tabling the 201718 Division of Revenue Bill, what is known as the budget speech, in parliament tomorrow.

In a statement, Cosatu said the budget should help start to unpack the president’s “radical economic transformation theme” he announced in the State of the Nation address.

The trade union federation said most of the economic transformation issues raised in the Sona focused on black economic empowerment and the already empowered, but presented no coherent, job creation plan and targets by government.

“As the federation, we expect the minister to allocate more resources towards government programmes that are meant to create jobs and adopt policy positions that will kick-start economic growth,” Cosatu said.

“The main priorities and the overall focus of the budget should be about addressing the triple challenges of the high levels of unemployment, deepening poverty and growing inequality.”

Cosatu also said it expected to hear about tax increases only for those who could afford them – the rich and not the working and middle classes.

The federation said it wanted to see an introduction of investment tax credits to encourage local procurement of machinery and equipment, and an increase in tax on financial transactions.

“The current socioeconomic situation in the country means that we should not have any increase on VAT or income tax for the lower- and middle-income earners,” Cosatu said.

“We want an introduction of a progressive tax system, with an introduction of a tax category for the super rich, including an introduction of solidarity tax, whose aim is to cap the growth of earnings of the top 10% and to accelerate the earnings of the bottom 10%.”

Cosatu said government should deal with tax evasion through conducting lifestyle audits for public representatives and those private individuals in the wealthy bracket. It should also consider tax incentives for small-, mediumand micro-sized enterprises.

On land reform and agriculture, Cosatu said it expected to see additional resources provided to meet land reform targets, as well as support for the sector to enable it to compete with international products. – ANA