No VAT hike means more debt and spending cuts, warns Enoch Godongwana

No VAT hike means more debt and spending cuts, warns Enoch Godongwana

Government will need to plug the R13.5bn shortfall in revenue if the 0.5 percentage point VAT hike is suspended, says finance minister

S/Africa: Minister Says Failure To Hike VAT Will Lead To Severe Implications

By Enyichukwu Enemanna Failure to increase the value-added tax (VAT) rate from next month would cause severe economic consequences, South Africa’s finance minister has warned, according to court papers. Enoch Godongwana’s position comes amidst a stand-off in the ranks of the parties that make up the country’s Government of National Unity (GNU) over the proposal contained in the 2025 budget. The two biggest parties in the coalition government, th…

The union suggests that the Treasury dips deeper into the Reserve Bank's gold and currency contingency reserve account rather than increasing VAT.