Budget positive for households, small business
Category From Our CEO
We are encouraged by the Finance Minister's frank acknowledgement in his Budget speech this week of the hardships that so many households are facing in the wake of the Covid-19 pandemic, and the Budget provisions made to try to 'keep money in the pockets of South Africans'.
These include the personal income tax relief he announced, the remarkable decision not to increase the fuel levy and the reduction in the corporate tax rate, which will especially benefit the individuals and small businesses that have borne the brunt of the economic destruction caused by the pandemic.
From a real estate point of view specifically, we are also pleased with Treasury's plan to facilitate a government loan guarantee scheme that will enable small business owners to gain better access to bank funding, and with the increased allocations to the presidential job creation programmes, specific infrastructure repair and development plans and the retention of teachers.
We hope that all these measures will help in the near to medium-term to bring about a significant increase in employment, which will be key to maintaining a healthy property market in SA.
However, our market is also very sensitive to consumer sentiment and confidence in the future development of South Africa, as we have seen recently with the increase in semigration and emigration in response to the KZN riots, return of load shedding and increase in serious crimes.
This sentiment will be massively improved, we believe, by the announcement that there will be no more bailouts (using taxpayers' money) for our struggling State-Owned Enterprises. We sincerely hope now that the commitments made to introduce specific measures to prevent public sector corruption and financial mismanagement will also be honoured."
Author: Chas Everitt