Davis questions economic sense behind impending VAT hike
CAPE TOWN - Retired judge and chair of the tax review committee, Dennis Davis, has questioned the economic sense behind an impending value-added tax (VAT) hike.
He believes that in a budget of more than R2 trillion, the shortfall can be found by cutting expenditure instead.
In an address to the Cape Town Press Club on Tuesday, Davis said the staggering spend on the public sector wage bill was also something government needed to reconsider.
Having chaired the tax committee that made recommendations to Treasury on tax policy between 2013 and 2019, Judge Dennis Davis thinks a tax hike in a stagnant economy is unnecessary.
When compared to the size of the country's budget, Davis believes the money Treasury hopes to raise from a 0.5 percentage point increase from May is relatively small.
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