The fact that
the government is very short of money is rather well known and so consumers are
not much surprised that their little luxuries like food, fuel and fun will
suffer from increased taxes. The numbers are on the government’s side when it
comes to the possibility of a tax revolt, however. Only 14m people are
registered tax payers and almost half of these have income below the tax
threshold. The Budget Review reveals that 40% of the income tax is paid by just
282 619 individual taxpayers. Presumably if even half this number did all
gather in Pretoria and march on the Union Buildings it would cause a newsworthy
event. But the way the voting system works they would cause barely a blip on
the election results. And don’t expect the 43m or so non-taxpayers to be sympathetic!
Just what did
those poor aloes do to deserve being be lugged into parliament on Wednesday to listen
to Minister Tito Mboweni’s maiden budget speech? The poor plants were described
as resilient, a word used by the press to describe the budget itself, but
exactly what this means is not explained. We will need some report on their
health in months to come to see if they survived the experience. The speech was
full of some very wishful thinking about heroic increases in tax collection in
the future. On average, SARS currently collects just R106bn a month. However,
to attain the target for Fiscal 2019, ending in just over two months’ time,
Tito and his aloes need to collect a huge rate of R175bn a month. The all-time record monthly
tax take of R161m was set in December 2018. Even if the newly launched Illicit
Economy Unit manages to track down every smuggled cigarette and collect the
duty owing the deficit is going to overshoot.
The budgeted monthly
average collection in Fiscal 2020 is pegged at R132bn and even new and
increased imposts for that year, like the contentious Carbon Tax, the R65.84
duty on a bottle of whisky and an extra 64 cents duty on a cigar might not be
enough. As for the success of his mooted gesture of goodwill on behalf of MPs and
other senior state executives to forego a salary increase – well let’s see how
that flies. Austerity is not a team sport enjoyed by public servants used to
perks and prizes. In fact, all of those
who in one way or another feed at the trough of public money and who have been targeted
for a spot of belt-tightening are already starting to whine and shake their
heads and fists. Perhaps the most intriguing part about the government at last
trimming their wages bill is that much of money saved will be used to keep the lights
on by supporting Eskom. When and if that gets widely recognised small wars
could break out between government staff and Eskom employees. Watch this space.
Now SAA will
also be split into three parts, and like the similar idea about Eskom, this
plan has triggered complaints from those who fear their little sinecure could
be uncovered and they will be required to deliver for their salary. Unfortunately, the argument about and execution
of this proposed rationalisation of the national airline will probably take
ages and certainly cost money. Whether or not this is the right remedy should not
anyway be something for our government to decide upon. There is already ample evidence
that they are hopeless at running most things – in particular, they are
lethally bad when it comes to potentially profitable enterprises. Just sell the
darn thing now and let the buyer decide if there’s any way to revive the
albatross. And while they are about it, sell the airports too. ACSA has a
suspiciously race based share holder profile dominated by the state and seems
to charge a great deal for allowing a plane to land.
As things
stand in PE it seems as if the Proteas and Sri Lanka once again won’t need a
fifth day or even a fourth to embarrass one of the sides in the second and
final test match. It’s a shame. Durban is getting excited about
getting into Kings Park tomorrow to watch the Sharks’ opening home match of the
season. The talk at the bowling club bar this evening will be all about the catering
arrangements tomorrow with the early kick-off suggesting tea and scones rather
than boerie and Hansa.
James
Greener
Friday 22nd
February 2019
