24 April 2025
The Caucus of the African National Congress (ANC) in Parliament welcomes the announcement by the Minister of Finance to stop the proposed increase in Value Added Tax (VAT) which was scheduled to commence on 1 May 2025.
Following the adoption of the fiscal framework on 2 April, the parties that supported the framework agreed that they would present alternative revenue proposals and corresponding expenditure savings to the National Treasury within a period of 30 days.
Together, and considering the views of South Africans across the party-political divide, the parties extensively engaged with the Minister of Finance on the proposed VAT increase, leading to today’s announcement.
The proposed VAT increase had eclipsed pro-poor and expansionary aspects of the budget such as increased allocations to social support programmes and infrastructure investment, a departure from the austerity of the past decade. The resolution of the VAT issue will hopefully focus public discussion to the progressive elements of the budget.
Every experience teaches us valuable lessons. Two takeaways from this year’s budget process are worth mentioning, amongst others.
Firstly, the impasse underscored the need for a more transparent and inclusive approach to matters of national expenditure. We therefore look forward to the Minister’s tabling of the Money Bill Amendment Act and, through it, the options that the National Treasury has considered appropriate in the circumstance.
Secondly, by putting aside our political differences in search of solutions to a national challenge, the parties that supported the fiscal framework have demonstrated the true meaning of mature leadership. South Africans of all walks of life, especially working people and the unemployed, are the real winners of this patriotic spirit.
The ANC looks forward to building on this multi-party cooperative spirit to tackle other multiple national problems and challenges, whose resolution require the undivided attention of all South Africans across the political, racial, class, gender and other divides.
Issued by the Office of the Chief Whip
Comrade Mdumiseni Ntuli, MP
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