PREVIEW: Tito Mboweni’s mid-term budget
Could Finance Minister Tito Mboweni present a financially prudent and growth-friendly balance sheet?
Analysts say it will be difficult.
There’s a stunt in the economic growth, there are fewer businesses and employees paying taxes, and South Africa is borrowing at delicate levels.
Recently in July, Mboweni warned that South Africa’s debt-to-GDP ratio would reach an unmanageable 140% within a decade if we didn’t do anything about it.
But if we cut spending and lending, we could stabilize the debt-to-GDP ratio at 87% by 2023.
The impact of COVID-19 continues as other obligations have made this desperate task too ambitious, even the president’s Economic Advisory Committee thinks so.
South African Airways will receive more than R10 billion, an additional R6 billion will be allocated for the extension of the COVID-19 grant and R100 billion for a massive three-year employment program, announced by the president.
There is also a tax notice.
Although the new fiscal policy announcements only made in the February budget, analysts said the finance minister may hint at possible wealth taxes.
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