Cape Town - The ANC has welcomed the 2018 budget delivered by Finance Minister Malusi Gigaba calling it “progressive” a “people-centred”.
Gigaba delivered the budget speech on Wednesday in the midst of pressure to increase tax revenue.
The ANC said the minister was able to strengthen fiscal consolidation.
“Once again, the National Treasury has been able to balance the need for fiscal consolidation and strengthening our fiscal position on the one hand, taking into account the revenue shortfalls from last year,” said the ANC.
Gigaba was highly criticised by opposition political parties for the decision to increase Value Added Tax (VAT) from 14% to 15%. The opposition said this could have been avoided.
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However, the ANC said it noted the increase in VAT, but welcomed the fact that certain food items such as brown bread would be exempted from the increase.
“We further welcome the above-inflation increases in social grants, which once again affirms our commitment to a comprehensive social security net for the most vulnerable in our society.”
Social grants will increase to R400 from April 1 and old age to R1690.
The ANC said that the increase in business confidence and the budget presented by Gigaba would provide for improvement in the economic outlook for the country.
“Now is the time to harness and capitalize on the improvements in business confidence and investor sentiment in South Africa, for the benefit of all our people. The African National Congress unequivocally supports efforts by the ANC led government to consolidate the deficit and stabilize debt in the medium term,” said the party.
The party said to achieve growth targets as set out in the budget will require the partnership with business and labour unions.
“Attaining the growth targets set out in the Budget requires all social partners working together, in concert, to realize our common goals. To this end, the ANC calls on the private sector to join hands with government and labour to realize our common objective of inclusive, job-creating economic growth,” said the ANC.
“The ANC remains committed to the mobilisation all social partners behind an economic recovery plan. Such plan must, of necessity, include strengthening governance and restoring the credibility of our state-owned enterprises (SOE).”