National Treasury insists there will be no tax increases this year after Minister of Finance Enoch Godongwana’s Medium Term Budget Policy statement.
Cape Town – National Treasury insists there will be no tax increases this year after Minister of Finance Enoch Godongwana’s Medium Term Budget Policy statement.
Head of the Budget Office in the National Treasury Edgar Sishi told MPs on Friday that the taxes would be announced in February when Godongwana delivers the national Budget.
However, there were certain factors that were considered for any tax increases.
“In the 2021 Budget in February we did indicate that at this stage, particularly with the fragility of the economy and the burden on the households and the poor, we don’t consider there is a compelling case to increase tax rates at this time.
“In previous budgets we have highlighted that in order to increase tax revenue, which we agree needs to happen, we need to focus on broadening the tax base rather than lifting rates on taxation on existing taxpayers.
“That is our focus,” he said.
He said they wanted to ensure there was increased revenue.
But he reminded MPs that since they started delivering the MTBPS in the 1990s it has always been a practice that no announcements are made on taxes until the Budget in February.
“As I was saying the announcement on tax will be made in the 2022 budget,” said Sishi.
Godongwana had also said some of the other issues he left out in the MTBPS would be dealt with in February.
In the mini budget Godongwana also made it clear there would be no bailouts for state-owned entities.
He wanted government to implement structural reforms in the economy saying this will boost growth.
This point was also raised by Sishi who told MPs that once the reforms are under way this will kickstart the economy.