CDE Urges Growth Strategy Over Tax Hikes for SA

As South Africa prepares for its 2025 Budget, CDE executive director Ann Bernstein advocates for reducing the proposed public wage bill increase from 5.5% to 3.5%, potentially saving R100 billion, rather than resorting to tax hikes. In a related discussion, political figures emphasize the need for structural reforms to stimulate growth, which has stagnated at around 1% over the past decade. Maimane and Zibi argue that the country's fiscal issues stem from poor spending practices and excessive borrowing, rather than the proposed VAT increase. They highlight a R60 billion budget shortfall that could be addressed through better management of public funds. The ongoing debate underscores a broader challenge in balancing fiscal responsibility with the need for economic growth amid rising public dissatisfaction with government performance. These discussions reflect a pressing need for innovative strategies to address budgetary constraints and stimulate economic recovery.