South Africas new president, Cyril Ramaphosa, risks alienating voters in the run-up to next years elections after his administration announced plans to raise sales tax and curb spending as it seeks to stabilize debt and prevent a third junk credit rating.
The value-added tax rate will be raised to 15 percent from 14 percent, the first time since the end of apartheid that the government has targeted a charge seen as hitting the poor hardest. Levies on fuel and luxury goods will also go up, while planned spending will be cut over the next three years, according to Finance Minister Malusi Gigaba. The rand and government bonds gained.
These fiscal proposals will cause economic discomf…
Read the full article at: https://www.bloomberg.com/news/articles/2018-02-21/ramaphosa-takes-tax-gamble-as-south-africa-targets-debt-ratings