South Africa: Mboweni's Poser Is Matching Wishlists & Sparse Public Finances. Spoiler Alert - Something Has to Give

South African Finance Minister Tito Mboweni in September 2019.
analysis

Exactly what gives will be answered when Finance Minister Tito Mboweni presents the Budget on Wednesday. Worst case scenario: Snafu*.

The easy bit is to recount the numbers: 0.4% economic growth in 2019, 38.7% joblessness on the broader definition that includes those so disheartened they've given up the search for work -- and consumer and business confidence in the doldrums regardless of what measure is used.

The scary bit is to recount some other numbers. A shortfall of several tens of billions of rand in estimated tax collection -- the October 2019 Medium-Term Budget Policy Statement (MTBPS) put that number at R52.5-billion, or 4% short, and rising -- amid business failures, retrenchments and low wage increases. Billions of rand may fly SAA's way as the R5.5-billion for the business rescue process since 6 December 2019 will run out in early March 2020.

As much as the Budget is about numbers, it is much more about politics.

And the politics mean no to even a one percentage point hike to Value Added Tax (VAT). The blowback from the 2018 VAT hike to 15% was brutal, and with a municipal election in 2021 the governing ANC, which is looking to reverse two...

See What Everyone is Watching

More From: Daily Maverick

Don't Miss

AllAfrica publishes around 800 reports a day from more than 140 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.