Both the uMkhonto weSizwe (MK Party) and the Economic Freedom Fighters (EFF) have scoffed an alleged attempt by the African National Congress (ANC) to woo them to support an increase in the VAT after the Democratic Alliance (DA) openly opposed to it.
Last month Finance Minister Enoch Godongwana’s tabling of the 2025 Budget was postponed after Government of National Unity (GNU) partners failed to agree on the 2% increase of the Value-Added Tax (VAT). But reports have since surfaced that the ANC is trying to get the MKP and EFF to support it on its revised 0,75 increase.
For the first time in its post-apartheid history, South African parliament under the GNU arrangement failed to present its first budget. The two main parties in this new government differed over policies that are feared to further burden the poor and the working-class.
But the ANC is now reportedly in favour of the 0,75% hike and wants to woo the MKP and the EFF to support it.
Speaking to the SABC MKP spokesperson Nhlamulo Ndhlela says they will not budge on any increase to the VAT.
“We will not entertain any discussion of an increase on the VAT as it has a ripple effect on the cost of living of the already poor of the poorest in this country.”
Ndlela proposed several alternatives instead of taxing the already hard-pressed consumers.
“The Ramaphosa administration must increase wealth tax, they must increase high income tax and increase the corporate tax that they reduced by 2% in his first budget. So if they can reduce corporate tax as they did in his first budget vote, then they should be looking at increasing it more, that is where everyone else is going to be benefiting.”
On its short statement the EFF spokesperson, Sinawo Tambo, on the other hand warned against using the red berets as a sacre crow in the VAT increase debacle.
Tambo says they will only participate meaningfully in the GNU with the exit of the DA in the pact.
Earlier, the ANC’s historic ally, the SACP, also vehemently opposed the VAT hike. Its spokesperson Dr Alex Mashilo said this is going to plunge the poor deeper into hunger.
He proposed some alternatives to the budget.
“The alternatives we are calling for, must also include straightened regulation of the capital account, a decisive clampdown on illicit financial flows and aggressive confrontation of base erosion and profit shifting. We are calling a wealth tax because South Africa is one of the most unequal countries in the world. We cannot pursue taxes that punish the poor while we leave the rich smiling all the way to the banks. The Politburo calls for an urgent consultative alliance process and tasks the Secretariat to take a lead in implementing this call.”
