Taxes not the answer – DA

Taxes are not the answer to South Africa’s need for more money for state spending, but higher economic growth is, DA spokesperson on finance Tim Harris has said.

Harris and deputy finance spokesperson David Ross as well as the DA’s federal chairperson, Wilmot James, briefed journalists about the DA’s suggestions for an alternative budget this morning.

This comes ahead of Finance Minister Pravin Gordhan’s Budget speech on Wednesday.

There has been talk about higher taxes after President Jacob Zuma announced a tax review, but government officials said this wasn’t likely to happen this year.

Harris said South Africa already had the highest tax rates compared to other middle-income countries similar to South Africa.

The DA proposes that economic growth be targeted at 8% per annum, up from the current 2.7%.

The party also proposes that government be streamlined, an exercise that could save the country R3 billion, it says.

According to the party’s document of proposals, the departments of economic development, women, children and people with disabilities, public works and sport should be disbanded.

It also proposes the merger of the departments of public service and cooperative governance, a single department of education, a single ministry of natural resources, and the rationalisation of the communications functions of the department of trade and industry.

The DA also wants to do away with district municipalities, a move it says could save R529 million, and the National Youth Development Agency, which costs the country R428 million.

The party also suggests that the budget for the presidency be slashed by R122 million – from R452.5 million, the VIP security bill by R211 million and the budget for the secret service by R3.3 billion.

The party also estimates that R3 billion can be saved if government cuts down on the use of consultants.