Pay your tax or we will ‘break your bones’ – Mboweni

During his medium-term budget speech, delivered in parliament on Tuesday afternoon, Finance Minister Tito Mboweni reminded South Africans to pay their taxes.

“Render under Caesar what belongs to Caesar or Caesar has a tendency to break your bones,” he joked.

The minister said that “achieving a more inclusive SA relies on honest taxpayers”.

“Without your taxes, SA will never succeed. Thank you to all those who have honoured their obligations.

“But you have told us that we must spend your hard-earned money better, and we could not agree more,” he added.

“We now expect to collect R1.37 trillion this year. This is R53 billion, or 4%, less than we expected.

“Looking ahead, our revenue forecasts are prudent. We assume an elasticity of one, which means a one-to-one relationship between growth in taxes and economic growth, after adjusting for tax measures.”

The finance minister brought out the aloe ferox plant his speech centred around in February for the speech.

“This little aloe ferox is emerging from a long winter. During that time … we toiled, hoping for better days. Here, we stand at the end of winter, the food cupboards are almost bare,” he said.

Following his reminder about tax, he added: “Our little aloe ferox is not doing well, Mr President, it needs attention like our public finances.”

This attention, he said, would require “sacrifices by all of us” and “additional revenue measures”.

“The consequences of not acting now will be grave,” he warned.

The minister said he worried that if measures weren’t taken, we could end up in a “debt trap” with “mounting debt service costs and higher interest rates”.

The minister conceded that Sars was “emerging from its own winter.”

“Cabinet has approved that we implement the findings of the Nugent commission of inquiry into tax administration and governance, and I intend to table a bill early next year.

“The president has appointed Edward Kieswetter as the new commissioner.

“Since he started work in May, he has already taken steps to re-invigorate and re-establish the Large Business Centre, and the litigation, integrity and compliance units. Leadership, staffing and procurement failures are also being addressed.”

(Compiled by Daniel Friedman)

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