Prescribed assets – Could ANC be going for savers as it runs out of options?

Finance Minister Tito Mboweni is in a tight squeeze as he is grappling with a growing budget deficit with the state-owned enterprises, particularly Eskom acting as a major drain on finances. The taxes that he is able to raise have been limited by the fact that the number of individual taxpayers is growing slowly and tax income from companies has been hampered by loadshedding with only 24.3% of companies reporting positive taxable income at the end of 2019, according to figures supplied by the South African Revenue Service. Mboweni told journalists at Davos in Switzerland earlier this year that he would take taxes wherever he could find and had recently hinted that the cannabis market and “handy clappy, snake eating churches” could be sources of income. But would he go after retirees by prescribing assets; a policy that the ANC adopted at its 2017 conference, which President Cyril Ramaphosa supported? Economists are divided on whether the Treasury would follow this path with Pan African Investment and Research Services chief executive Iraj Abedian saying he would be “shocked out of his boots” if Mboweni went along with it. Nicholas Babaya writes in the Daily Friend that going after savers is a dangerous path for the ANC Government to consider. – Linda van Tilburg

Prescribed Assets – a dangerous path

By Nicholas Babaya