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'It’s possible to pull the economy out of its nosedive'

The minister has unveiled a plan aimed at reigniting economic growth.

Finance Minister Pravin Gordhan. Picture: Reinart Toerien/EWN.

CAPE TOWN - In his tabling of the 2016 Budget, Finance Minister Pravin Gordhan has stopped short of raising VAT or personal income tax and says government spending will be cut by R25 billion over the next three years.

Consumers won't get off scot-free - he's hiking the fuel levy by 30 cents and introducing a tyre levy and a tax on sugar-laden beverages.

The minister has unveiled a plan aimed at reigniting economic growth and paying down the government's massive debt.

Contrary to expectations he's held back on hitting taxpayers with income tax hikes, spreading the pain by increasing levies instead.

He's focused on cutting government spending and reprioritised funds to allow for billions to be allocated to higher education, the infrastructure needed to grow the economy, drought relief and helping social grants and pensions keep pace with inflation.

Gordhan says it's possible to pull the economy out of its nosedive.

"It, however, requires bold and constructive leadership in all sectors of society. A shared vision, a common purpose and a well-defined common ground. Above all, we need action and not just words."

He says government can't carry on borrowing money it can't afford to repay.

WATCH: Budget 2016 in 60 seconds