The Western Cape High Court has ordered the suspension of the planned VAT increase until Parliament passes legislation to formally reverse the decision.
The ruling was made on Sunday afternoon after discussions between all parties and the judges involved in the case. The court also overturned the parliamentary resolutions that had approved the fiscal framework, which outlines the national budget.
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Although Finance Minister Enoch Godongwana announced on Wednesday that the VAT increase would be reversed, there were questions about whether this was legally possible without Parliament’s approval. The Democratic Alliance argued that only Parliament had the authority to reverse the hike and that immediate action was needed to prevent the increase from taking effect on May 1.
The court’s decision allows time for the necessary legislative process, while leaving the broader legal challenge to the VAT Act itself open for future argument.