Moneywebtax - Treasury expects R13bn tax revenue shortfall - BUDGET:
South Africa's economic situation is moving from bad to worse as the downward spiral continues even the tax income is dwindling. In the meantime the Regime is trying to present a variety of excuses for the shortfall, while it is clear that the whole country is headed for a crash.
CAPE TOWN - Treasury is estimating a R13bn under collection in tax revenue and this will require the government to temporarily increase its borrowings.
Minister of Finance Pravin Gordhan said tax revenue collections had not yet recovered fully from the effects of the recession.
With the shortfall of R13bn the estimated gross tax revenue has been reduced to R728.6bn, largely due to a downward revision in net VAT receipts. The VAT receipts have fallen by R13,4bn to R187.5bn, owing to an underestimation of VAT refunds for 2011/12 at the time of budget.
"What this requires is an application of our counter-cyclical policies," Gordhan said.
He added that higher borrowing would be carefully managed as capital markets were volatile and debt servicing costs already the fastest growing category of expenditure. However Gordhan pointed out that Treasury would not introduce a new bond to raise more money.
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