Minister Enoch Godongwana reverses proposed VAT increase

by Sergio Miller

South Africans across the country can now breathe a sigh of relief as Minister of Finance Enoch Godongwana has announced his decision to reverse the proposed 0.5% VAT increase, which was set to come into effect as of next week. 

The announcement came after the minister received lots of pressure from opposition parties like the Democratic Alliance (DA), the Economic Freedom Fighters (EFF) as well as a public outcry from citizens. 

Meanwhile, the Treasury stated that they had to re-examine the proposed plan after considering the recommendations of the Parliamentary committees and continuous consultations with other parties, which form part of the Government of National Unity (GNU). 

A statement released by the Minister stated: “The decision not to increase VAT means that the measures to cushion lower-income households against the potential negative impact of the rate increase now need to be withdrawn and other expenditure decisions revisited.” 

Meanwhile, it is now stated that Parliament will have to adjust expenditure in a manner that ensures the loss of revenue does not harm South Africa’s fiscal sustainability. 

Following the overnight announcement, opposition parties have been rejoicing. 

Taking to X (formally known as Twitter), BOSA, DA and the EFF have shared their thoughts on the recent decision to reverse the VAT increase to 15,5 percent. 

“This is a win for every household, every breadwinner, and every South African who cannot afford higher prices at the till. We would like to thank you for uniting behind the cause to reject the VAT hike. From Parliament to the streets and in court,” commented the DA. 

The EFF posted:

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