Budget week is a good time to restate the obvious: Government is only as good as its tax base
Budget week is a good time to restate the obvious: Government is only as good as its tax base. All the government programmes, the service delivery milestones, the public sector salaries including that of Finance Minister Enoch Godongwana who must balance the books this week, are largely dependent upon his taxpayers.
There would be no budget to balance without those of us who cough up personal income tax, who form companies that pay corporate tax, and who drive the economic activity that generates VAT.
When Godongwana addresses us on Wednesday, he will tell us what he plans to do with our money. And in the same way that we demand our money's worth from the shopkeeper, the mechanic, or the doctor, we should pay close attention to what Government intends doing with our earnings.
No doubt Godongwana shares our frustration at the thought of how much easier his job would be, and how much more money he would have to dispense, if Government officials spent as much time thinking about how to create tax revenue as how to utilise it.
In this regard the Cape Chamber has identified several key investment areas that, in our view, would give us great return on our tax investment. Top of the list should be our police force and vocational colleges.
Crime is having a debilitating impact on society, devastating many communities and eroding business confidence, Without an effective police force we are vulnerable to increasingly sophisticated criminals who, if left unchecked, destroy morale and undermine the authority of the state. A functioning criminal justice system is a critical element if we are to progress.
Similarly, our vocational colleges are failing to produce the necessary pipeline of skills required to build the economy. We need market-led skills development that is fit-for-purpose. Bolstering skills development will have a multiplier effect in terms of jobs, growth, and tax revenue, ensuring there is more tax pie to dish out, rather than having to make do with the same old crumbs.
Godongwana should remember that we taxpayers pay his salary, too. We hope he will return the favour.
John Lawson
CEO of the Cape Chamber of Commerce and Industry