Consumers will pay more for brown bread. This is due to a technical change contained in the recent Taxation Laws Amendment Bill 2017.
All categories of brown bread will no longer be zero-rated and consumers can expect to pay a standard VAT rate of 14% on purchases of affected categories of brown bread. The Taxation Laws Amendment Bill 2017 proposed an amendment to the VAT Act, which was intended to be a technical correction.
The proposal has the unintended consequence of changing the application of the current zero rating provision applicable to brown bread.