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How will the supplemenetary budget impact our tax?

24 June 2020 6:58 PM
Tags:
SARS
Tito Mboweni
Budget
Tax
COVID-19
Emergency Budget

Will increased tax collection help lift the economy out of the mud?

We are still not cutting on spending in the budget - we're now spending as much on debt as we are on the entire health service this year.

Where will the money come from and does that mean tax payers will have to cough up more yet again?

The Money Show asked Prof. Osman Mollagee, tax partner at EY, to explain some of the statements made by the minster in his supplementary budget speech today.

It does not get any better because clearly we cannot collect further revenue from tax increases...

Prof. Osman Mollagee - EY

One of the clear messages I think from today's speech is tax is not somewhere we can go - no immediate tax increases and even proposals for the future...

Prof. Osman Mollagee - EY

However, in the budget speech there was mention of tax measures of 40 billion rand over the next four years - what does it mean?

40 billion across four years is not that significant and the minister's comments also suggested only five billion rand of that in year one...to collect another five billion is not going to have a significant impact on tax payers.

Prof. Osman Mollagee, partner in tax - EY

But what about the ever-elusive structural reforms - at some point a band-aid on the gaping wound is not going to help and we'll bleed to death.

The big focus has got to be on spending...but bringing us back to what we can collect on the tax side...the repeated message is we are not going to be able to collect more revenue from taxes, so the structural reforms will have to be on the expenditure side.

Prof. Osman Mollagee - EY

Listen to the interview below.

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24 June 2020 6:58 PM
Tags:
SARS
Tito Mboweni
Budget
Tax
COVID-19
Emergency Budget

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