Finance minister Enoch Godongwana is set to present the revised 2025 budget speech on Wednesday after it was postponed last month.
The budget speech scheduled for February 19 was postponed due to disagreements with the DA, a partner in the government of national unity, over a proposed value-added tax (VAT) increase.
The DA and other opposition parties have vehemently opposed Godongwana’s plan to hike VAT by two percentage points from 15% to 17%.
However, the finance minister remains resolute, insisting the increase is necessary to fund the social relief of distress (SRD) grant. Godongwana has emphasised that if the SRD grant were scrapped, there would be no need for a VAT increase.
President Cyril Ramaphosa has suggested a compromise, proposing a “middle ground” VAT increase of between 0.5 and 1 percentage point.
Parliamentary chairpersons from the finance cluster have expressed concerns about the country’s financial situation, warning South Africa is on the brink of a significant crisis.
As Godongwana prepares to present the revised budget speech, all eyes will be on him to see how he addresses the VAT increase controversy and the country's financial situation.
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Image: Esa Alexander/Reuters
Finance minister Enoch Godongwana is set to present the revised 2025 budget speech on Wednesday after it was postponed last month.
The budget speech scheduled for February 19 was postponed due to disagreements with the DA, a partner in the government of national unity, over a proposed value-added tax (VAT) increase.
The DA and other opposition parties have vehemently opposed Godongwana’s plan to hike VAT by two percentage points from 15% to 17%.
However, the finance minister remains resolute, insisting the increase is necessary to fund the social relief of distress (SRD) grant. Godongwana has emphasised that if the SRD grant were scrapped, there would be no need for a VAT increase.
President Cyril Ramaphosa has suggested a compromise, proposing a “middle ground” VAT increase of between 0.5 and 1 percentage point.
Parliamentary chairpersons from the finance cluster have expressed concerns about the country’s financial situation, warning South Africa is on the brink of a significant crisis.
As Godongwana prepares to present the revised budget speech, all eyes will be on him to see how he addresses the VAT increase controversy and the country's financial situation.
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