Entrepreneurs, brands and the advertising and communications sector are well poised to benefit from micro-economic provisions announced by finance minister Pravin Gordhan in his latest budget, delivered this week.
CEO of the Association for Communication and Advertising (ACA), Odette van der Haar, said increased spend on infrastructure development and education, coupled with the R9.3 billion in income tax relief to the lower income earners “should stimulate certain sectors of the economy in a micro sense”.
“This is a very pertinent area for those in the business of advertising and communications as it presents an opportunity to leverage this windfall,” Van der Haar said in a statement. She said while the budget largely conservative and pragmatic, the tax relief would provide households with more disposable income.
“Aggressive and innovative strategies to stimulate continuous investment into advertising and communications will yield at least sustained, if not increased product sales that will ultimately benefit business and the economy in general,” she said.
“Whilst some may downplay these opportunities because of the increases in indirect taxes, i.e. the so called ‘sin taxes’ being implemented with immediate effect, rising fuel prices, the fuel and RAF levies, depreciation of the Rand and the introduction of e-Tolls in Gauteng to mention a few, it was very encouraging to hear the Minister note that GDP and Export growth are expected to grow positively over the next three years.”
Van der Haar believes this growth will “continue to stimulate the recessed economy and the very growth that will challenge those in the business of advertising and communications to achieve the ‘balance’ referred to by the Minister in his budget speech.
“’Balance’ means balancing the needs of government (read brands) with the needs of the country and its citizens (read consumers) to ensure responsible and meaningful advertising and communications initiatives to assist brands and consumers alike,” she said.
IMAGE: Finance minister Pravin Gordhan and President Jacob Zuma after the Budget Speech / GCIS