The African National Congress‘ (ANC) National Executive Committee (NEC) has resolved that government should consider additions to the zero ratings list, in order to to soften the impact of the Valued-Added Tax (VAT) increase announced in the budget speech.
Finance Minister Malusi Gigaba announced a one percentage point increase in VAT to 15% as the Ramaphosa administration seeks to steady the economy following what analysts say were years of maladministration, corruption and wanton spending.
ANC Secretary General Ace Magashule says the NEC will consult with social partners on the impact of the budget on South Africans – especially the poor.
“On VAT, I think we are aware that stakeholders and trade unions are raising some issues, particularly around basic foodstuffs – and we are saying it can’t just be rice and maize. We say there are these things which are challenges for the poor, and it will be good if government can engage further and itemise some of these items that should be zero-rated, so that we alleviate the challenges of the poor,” explains Magashule.
