Director of the Rhodes Business School Professor Owen Skae says "the economy of South Africa is not in a good state. and has been stumbling along for far too long now."
Speaking to Bongani Bingwa on 702, Skae says the VAT increase will bring in R22 billion revenue but there is a lack of clarity as to how the R85 billion reduction in government spending will be achieved.
The minister has done a little bit of an ambulance job.— Professor Owen Skae, Director of the Rhodes Business School
He says these means will plug the nearly R50 billion budget deficit but that is not enough.
The expectation would be, that the minister would layout in fundamental terms what the real challenges are that we facing.— Professor Owen Skae, Director of the Rhodes Business School
Skae says the finance minister should have provided more specifics on the R85 billion government cuts.
There are so many more questions that need to be answered and I'm not so sure that the minister and the government have thought about the answers to those questions.— Professor Owen Skae, Director of the Rhodes Business School
Professor Skae says the VAT increase will have a major impact on the poor, and it will be interesting to see what Cosatu has to say about the budget after rallying behind President Ramaphosa.
They acknowledge that you can't tax the wealthy much more... Personal income tax is almost at the level we can achieve.— Professor Owen Skae, Director of the Rhodes Business School
Listen to Professor Skae explain what economists hads expected from the budget speech.