Who won VAT hike battle?
SA government has officially backed down on a proposed 0.5% VAT increase on April 24, 2025, marking a dramatic policy reversal that has sparked a political tug-of-war over who gets the credit.
Initially introduced by Finance Minister Enoch Godongwana as part of his 2025 fiscal strategy to plug a R32 billion revenue shortfall, the VAT hike narrowly passed in Parliament on April 2.
The African National Congress (ANC) secured its passage with the support of ActionSA and Build One South Africa (BOSA), while the Democratic Alliance (DA) and Economic Freedom Fighters (EFF) fiercely opposed the measure.
Yet what followed was a groundswell of public backlash, amplified by the DA and EFF launching a joint court challenge. At the same time, ActionSA and BOSA began pushing for alternative solutions, such as targeted spending cuts and fiscal discipline.
When the VAT hike was ultimately scrapped, all sides rushed to claim a share of the glory. ActionSA leader Herman Mashaba and BOSA’s Mmusi Maimane touted their behind-the-scenes negotiations with the ANC, asserting that their conditional support for the budget forced the ruling party to reconsider.
Meanwhile, the DA’s Helen Zille hailed the U-turn as a “people’s win,” pointing to mounting public pressure and the looming court battle as decisive.
Fikile Mbalula, the ANC’s head of elections, commended ActionSA and BOSA’s “constructive engagement,” but notably ignored the DA and EFF’s legal offensive.
On social media South Africans appeared equally split. Some praised the strategic finesse of ActionSA and BOSA for influencing policy from within, while others highlighted the relentless opposition and legal threat posed by the DA and EFF.