{"id":751462,"date":"2024-02-14T06:50:48","date_gmt":"2024-02-14T04:50:48","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=751462"},"modified":"2024-02-14T06:50:55","modified_gmt":"2024-02-14T04:50:55","slug":"nedbank-sends-a-warning-to-finance-minister-enoch-godongwana","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/751462\/nedbank-sends-a-warning-to-finance-minister-enoch-godongwana\/","title":{"rendered":"Nedbank sends a warning to Finance Minister Enoch Godongwana"},"content":{"rendered":"\n<p>Nedbank has warned the government and South African Finance Minister that raising taxes in a weak economy will do nothing but prolong financial woes amid the high cost of living in South Africa.<\/p>\n\n\n\n<p>South African Finance Minister Enoch Godongwana\u2019s plans to raise additional taxes as he tries to arrest runaway debt will be ineffective given the battered economy, according to the country\u2019s fifth-largest bank by value.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-wp-embed is-provider-businesstech wp-block-embed-businesstech\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"wp-embedded-content\" data-secret=\"8XtVeTTRY4\"><a href=\"https:\/\/businesstech.co.za\/news\/budget-speech\/751180\/tax-hikes-on-the-cards-for-the-rich-in-south-africa\/\">Tax hikes on the cards for the rich in South Africa<\/a><\/blockquote><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;Tax hikes on the cards for the rich in South Africa&#8221; &#8212; BusinessTech\" src=\"https:\/\/businesstech.co.za\/news\/budget-speech\/751180\/tax-hikes-on-the-cards-for-the-rich-in-south-africa\/embed\/#?secret=FWK2DEyfbW#?secret=8XtVeTTRY4\" data-secret=\"8XtVeTTRY4\" width=\"500\" height=\"282\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<p>\u201cRaising taxes in a weak economy is counterproductive; it will not raise that revenue,\u201d said Isaac Matshego, a senior economist at Nedbank Ltd.<\/p>\n\n\n\n<p>In November, Godongwana signalled that he would announce new tax measures to raise an additional R15 billion in his Feb. 21 budget. <\/p>\n\n\n\n<p>The country is facing spiralling debt and growing spending needs that may be exacerbated by-elections in which the ruling African National Congress risks losing its national majority for the first time since it took power in 1994.<\/p>\n\n\n\n<p>Lifting taxes would likely squeeze already strained consumers and hurt corporates, particularly in the mining sector, where weaker commodity prices and higher operational costs due to incessant power cuts and logistics bottlenecks have hurt profitability.<\/p>\n\n\n\n<p>\u201cWe would not expect higher revenue to come from higher taxes. We saw that happening, for instance, with VAT,\u201d Matshego said. <\/p>\n\n\n\n<p>\u201cWith the higher VAT, people just spent less, and there was a drop in tax collections.\u201d<\/p>\n\n\n\n<p>South Africa in 2018 jacked up value-added tax on some goods and services to 15% from 14%. Nedbank sees the economy growing 1.1% in 2024, compared with an estimated 0.3% last year.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p><strong>Read: <\/strong><a href=\"https:\/\/businesstech.co.za\/news\/finance\/751370\/interest-rate-pain-wont-go-away-in-south-africa\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Interest rate pain won\u2019t go away in South Africa<\/strong><\/a><\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Nedbank has responded to the possibility of raising taxes in South Africa next week.<\/p>\n","protected":false},"author":59,"featured_media":667099,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[1850,853],"class_list":["post-751462","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-bloomberg","tag-south-africa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/751462","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=751462"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/751462\/revisions"}],"predecessor-version":[{"id":751466,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/751462\/revisions\/751466"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/667099"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=751462"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=751462"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=751462"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}