'We want zero VAT’: MK Party marches against proposed increase

Hundreds of supporters of the Jacob Zuma-led MK Party (MKP) took to the streets in Pretoria on Monday to protest against the proposed two percentage point increase in VAT.

The party voiced concerns over the economic strain a VAT increase would place on low-income households and small businesses.

The march stretched through Church Square to the offices of the National Treasury and the SA Reserve Bank.

MKP chief whip Mzwanele Manyi said the government’s plan to zero-rate certain food items does little to alleviate the broader financial burden on citizens.

“We are not opposed to the zero-rating of some foods, but we are saying that it is not enough. There shouldn’t be a trade-off between zero-rating food and increasing VAT. Increasing VAT brings inflationary pressure, especially on poor people, who not only need food but are also burdened with other essential costs such as transport and electricity. This thing about zero-rating the food basket is generally a smokescreen," he said. 

The march comes as President Cyril Ramaphosa's cabinet is preparing to finalise the budget speech to be tabled in parliament by finance minister Enoch Godongwana on Wednesday. It was postponed in February when cabinet rejected a two percentage point VAT increase proposal.

Speaking to the media on Monday, Manyi outlined the key issues raised in the party’s memorandum to the National Treasury and the Bank.

“We are saying no to VAT. We're not interested in a partial increase or 0.5%. We want zero VAT,” he said.

The MKP believes there are alternative ways to raise the necessary funds for the budget without burdening the poor.

“There are more than enough ways in which money can be derived from the population of this country. One of them is tackling illicit financial outflows and transfer pricing shenanigans. If the government clamped down on these, they would be able to rake in a lot of money.”

The SA Revenue Service (Sars) as a key player in boosting revenue collection, said Manyi.

“Sars is ready to collect R800bn. All the government needs to do is support Sars in its efforts and the financial pressure can be alleviated.”

He emphasised the need to fight corruption, which has long plagued government spending.

“We must clamp down on corruption. It cannot be that we normalise it, including fruitless and wasteful expenditure. This executive is too loose with the fiscus.”

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