Fiscal Framework and Revenue Proposals

The IEJ argues that the 2026 Budget fails to reverse a decade of austerity, instead implementing further cuts to non-interest spending and underinvesting in infrastructure and social services. The report criticizes the National Treasury's reliance on private sector investment and 'trickle-down economics,' noting that projected growth of 1.8% is insufficient to keep pace with labour force growth. The IEJ proposes increasing revenue through a net wealth tax and redirecting tax breaks for high-income earners, while calling for the South African Reserve Bank (SARB) to provide concessional debt for strategic industries, including green industrialisation. Additionally, the document critiques the Targeted and Responsible Savings (TARS) initiative and the Gender Budget Statement for failing to address structural inequalities and food insecurity.

• The 2026 Budget continues a trend of austerity by reducing non-interest spending by R5.2 billion in 2026/27 and by R14.2 billion in 2027/28 compared to the 2025 Budget.
• Projected medium-term economic growth of 1.8% is lower than the average yearly growth of the labour force, which was 2% between 2015 and 2025, suggesting unemployment will increase.
• South Africa's investment rate is just under 14%, falling far short of the National Development Plan (NDP) target of 30%; the 2026 Budget's allocations would only raise this to 16.5% if fully realised.
• Public spending on essential services is declining in real terms, with inflation-adjusted spending on education per learner dropping by an average of 0.33% over the medium term and healthcare spending per user falling from R4,108 in 2019/20 to R4,028 in 2026/27.
• The government's strategy to increase savings through tax-deductible allowances for retirement savings primarily benefits high-income earners and may increase inequality.
• The 2026 Budget's tax proposals generate no additional revenue over the medium term, as the R20 billion tax increase from the 2025 Budget was withdrawn and tax credits were adjusted for inflation.
• The debt-to-GDP ratio is expected to peak at 78.9%, which is higher than the 77.9% anticipated in the 2025 Medium-Term Budget Policy Statement.
• The second Gender Budget Statement (GBS) is criticized for being relegated to an annexure and for replacing 'Women’s Economic Empowerment' with the vaguer term 'economic empowerment,' failing to address structural issues like food insecurity in female-headed households.

APA

Institute for Economic Justice (2026). Fiscal Framework and Revenue Proposals. https://iej.org.za/wp-content/uploads/2026/03/IEJ-_-Fiscal-Framework-and-Revenue-Proposals-Submission-_-2026-BUDGET.pdf

Chicago

Institute for Economic Justice. Fiscal Framework and Revenue Proposals. 2026. https://iej.org.za/wp-content/uploads/2026/03/IEJ-_-Fiscal-Framework-and-Revenue-Proposals-Submission-_-2026-BUDGET.pdf.

Wikipedia

{{cite report |author=Institute for Economic Justice |title=Fiscal Framework and Revenue Proposals |date=9 March 2026 |url=https://iej.org.za/wp-content/uploads/2026/03/IEJ-_-Fiscal-Framework-and-Revenue-Proposals-Submission-_-2026-BUDGET.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{instituteforeconomicjustice2026fiscal, author = {{Institute for Economic Justice}}, title = {{Fiscal Framework and Revenue Proposals}}, institution = {Institute for Economic Justice}, year = {2026}, month = mar, url = {https://iej.org.za/wp-content/uploads/2026/03/IEJ-_-Fiscal-Framework-and-Revenue-Proposals-Submission-_-2026-BUDGET.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }