CAPETOWN: South Africans brace themselves for the increase in Value Added Tax (VAT), the National Treasury remains adamant they will go ahead with the 1% increase despite public outcry.
The former minister of finance Malusi Gigaba had announced during his budget speech that South Africa will see its first VAT increase in 25 years and as of April 1, VAT will increase from 14% to 15%.
According to the Treasury, the move will add at least R 22, 9 billion to the government coffers.
In his speech the former minister said that the tax increase was unavoidable and that government had to maintain its public finance integrity.
The question on everyone’s lips is how will low income earners be affected as it is well known the South Africa is one of the most unequal societies.
Despite the exclusion of certain items deemed necessities such as basic food items including bread, maize, beans and rice, it must be noted that families do not survive on these VAT exempt items alone.
To gain a local perspective the Fever took time to speak to people from around the area who had mixed views with regards to Treasury’s decision to increase VAT.
