DA unveils 6-point budget plan to boost economy without tax increases

The Democratic Alliance (DA) has outlined an alternative six-point budget proposal aimed at driving economic growth and job creation without resorting to tax increases, expanding debt, or cutting essential services.

Speaking at a parliamentary briefing, DA spokesperson on finance, Mark Burke, criticised the ANC’s fiscal approach, stating, “Despite an ever-growing budget, lives are getting worse. The ANC's solution is to spend more, borrow more, and tax more, with zero focus on efficiency. It's insane.”

This comes after the national budget was rejected and postponed at the last minute by Finance Minister Enoch Godongwana last week, due to disagreements over the proposed 2% Value-Added Tax (VAT) hike.

The DA said they firmly oppose any new tax increases, including VAT hikes, personal tax adjustments, and corporate tax adjustments.

Burke emphasised that South Africa does not have a revenue problem, but rather a spending prioritisation issue.

“We do not have a shortage of tax revenue; we have a shortage of scrutiny,” he said.

The party argues that the required R60 billion in new expenditure — only 3 % of the total R1.9 trillion budget — can be sourced by eliminating wasteful and underperforming government programs, rather than imposing additional burdens on taxpayers.

To achieve the necessary savings without compromising essential services, the DA has proposed several cost-cutting measures.

These include reducing government advertising budgets by 50%, cutting travel and catering expenses by 33%, and freezing non-essential government hiring for a year. Additionally, a national audit of "ghost employees" is recommended, following Prasa's recent revelation that 10% of its workforce did not actually exist.

“As Cabinet goes back to the drawing board on a new budget, we believe these proposals will position our country on the right footing — without raising taxes, increasing our debt, or cutting frontline services,” Burke said.

Beyond budget cuts, the DA insists that economic growth is the only sustainable path to prosperity. To instill market confidence and drive investment, calling for urgent structural reforms, including the fast-tracking of logistics and trade reforms.

This includes setting clear deadlines for the concessioning of freight rail and major ports such as Cape Town and Richards Bay.

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The DA also proposes establishing a $5 billion (R92 billion) concessional lending agreement with the World Bank for high-impact urban infrastructure projects. These projects would not add to the national debt but would stimulate economic activity.

To ensure responsible fiscal management, the DA calls for a three-month emergency spending review to identify wasteful and failing programs.

This would allow for the reallocation of R58 billion toward essential services such as healthcare, policing, and education. The review would also enable the government to fund legally mandated commitments, including the R7 billion public sector wage increase, without resorting to tax hikes.

Burke emphasised that the government has the ability to shift spending throughout the year as inefficiencies are identified. Rather than further burdening taxpayers, the DA argues that the government should focus on improving tax compliance and unlocking state assets.

“Increasing tax compliance from 63% to 67% alone could generate an additional R60 billion per year. Selling underutilised state-owned land and properties, another proposed measure, could raise R10 billion annually,” he said.

Godongwana is expected to table the budget on March 12. 

IOL Politics