There will be no dramatic tax shocks. VAT stays at 15%. Personal income tax brackets are modified in accordance with inflation to mitigate the effects of bracket creep.
Corporate tax rates are untouched. SOUTH Africans will tune in tomorrow not for fireworks, but for reassurance. Finance Minister Enoch Godongwana’s Budget Speech arrives like a doctor delivering test results that are “stable”.
No immediate catastrophe. No cure either. The message will be calm and measured: fiscal consolidation is working, debt is stabilising, and the Government of National Unity (GNU) is holding the line.
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All of that is technically true. None of it is enough. The numbers will look better than many feared.
Gross debt is expected to stabilise at just under 78% of GDP, edging down only slowly in the years ahead. The main budget deficit narrows to around 4.4% of gross domestic product (GDP), helped by a welcome but fragile boost from higher gold and platinum prices. A primary surplus of approximately 1% is expected to strengthen further.
Debt service costs remain brutal, swallowing more public money than health or policing, but at least they are no longer spiralling. Godongwana will point to practical wins as proof that discipline works. Load shedding has been absent for more than 200 days.
Freight logistics are inching forward through private sector participation. Social grants are paid on time, every month, with remarkable reliability. These are not illusions.
They are real achievements, and they matter. They reveal what happens when ideology takes a backseat and execution takes over. Markets will respond positively.
Borrowing costs should remain contained. The coalition will breathe a little easier. In a volatile world, calm counts for something.
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