Finance Minister Enoch Godongwana has announced that he will soon introduce a bill in Parliament that proposes to maintain the Value-Added Tax (VAT) rate at 15% from 1 May.
This reversal was from Godongwana, who previously indicated that he did not see a way to avoid increasing VAT without alternatives for raising revenue on the table. “By not increasing VAT, estimated revenue will fall short by around R75 billion over the medium-term,” the Ministry of Finance said in a statement. “The decision to forgo the increase follows extensive consultations with political parties and careful consideration of the recommendations of the parliamentary committees.”
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Earlier this year, his utterances caused an uproar in the Government of National Unity (GNU) when he proposed increasing VAT by two percentage points. This resulted in the postponement of the budget speech, and President Cyril Ramaphosa discussed alternatives with his cabinet.
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In a statement, the EFF has called for the immediate resignation of the Minister of Finance and the Director General of the National Treasury. “This entire budget fiasco should be a reflection for the Minister of Finance and his Director General that they are out of depth and pose a threat to the economic stability of the country and, by consequence, are a threat to the livelihoods of South Africans. “The EFF calls on the Speaker Of The National Assembly to release all correspondence from the Minister of Finance and demands that she convenes a meeting of all leaders of political parties in Parliament, effectively. The country does not have a budget and the finance minister failed to table a lawful budget by the 31st of March 2025, as required by Section 27 of the Public Finance Management Act.”
Bongi Sikelo 