Taxpayers are expected to bear the burden of a widening revenue deficit and government policy implications when finance minister Malusi Gigaba delivers his budget speech on Wednesday.
Gigaba will have to find ways to bridge the R51-billion revenue deficit while sourcing funds to make former president Jacob Zuma's promise of free higher education for the poor a reality this year.
Economists and finance experts believe the onus will fall on the taxpayer.
Economics expert Mike Schussler said he would rather see government find ways to increase its efficiency and pay more attention to how and where it spends its money.
"We need delivery of various government lags. For example, we spend a lot on our education as a percentage of our GDP, yet we have more than 32 pupils per class in public schools and the world average is 24. Only 40 percent of our pupils finish matric. I'd expect Treasury not to just tax me more, but make sure they deliver more with those taxes," Schussler said.
𝗕𝘂𝗱𝗴𝗲𝘁 𝗧𝗲𝗮𝗺 𝗯𝗲𝗵𝗶𝗻𝗱 𝘁𝗵𝗲 𝘀𝗰𝗲𝗻𝗲𝘀: Our Director-General and Deputy Directors-General of the Budget Office, Intergovernmental Relations, Public Finance, Asset and Liability Management and the The Office of the Chief Procurement Officer #Budget2018pic.twitter.com/gFeNUOJ5B3— National Treasury (@TreasuryRSA) February 19, 2018
"Another example is our public healthcare, which is a disgrace. We keep shifting more and more of the burden on to the taxpayer. We are one of the highest-taxed countries in the world. I expect we are going to have more taxes on fuel, a rise in Road Accident Fund levies, passenger taxes in airports as well as the introduction of carbon and sugar taxes later this year."
Schussler predicts that there will be little adjustment for inflation, despite increased taxes.
"It's going to be a harsh campaign this year. Since 2007, the tax burden [has been] increasing," he said.
Ettiene Retief, chairman of the national tax and South African Revenue Service (SARS) committee at the South African Institute of Professional Accountants (SAIPA), expects the tax-revenue deficit to swell to R69-billion this year.
In a statement, Retief said taxpayers should expect adjustments to the current taxable income brackets that will increase tax collections without the need to increase the actual rates.
Dear @CyrilRamaphosa, we the ordinary people are living from hand to mouth already. Instead of raising taxes and VAT, please consider cutting state depts and ministers by half , and the obscene salaries of the latter by at least a third #Budget2018— Heather (@HSteel5) February 18, 2018
Last year, the levels of all the taxable income brackets were increased by 1 percent, and a new top personal income tax bracket of 45 percent for taxable incomes above R1.5-million per year was introduced.
"An increase in the top marginal tax rate may result in increased efforts to evade tax by hiding income, or shifting income and wealth to other tax jurisdictions... People who fall into the top tax rate are not only taxed at a higher rate on the income they earn, but it also impacts the tax they pay on their capital gains when disposing of assets," he said.
"I would not be that surprised if [VAT] is increased... The political environment is different from what it was just a few months ago. The economic climate has changed and growth prospects are slightly better, so perhaps it is now the time for an increase."