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Responding to the DA and EFF’s applications to prevent the VAT increase from coming into effect on Thursday, 1 May 2025, Godongwana has defended his decision to increase the VAT rate in terms of section 7(4) of the VAT Act.
South Africa: Godongwana defends VAT increase, saying ‘severe consequences’ await if hike is suspended
Should the 0.5 percentage point value-added tax (VAT) increase, announced by Minister of Finance Enoch Godongwana on Wednesday, 12 March, be suspended, Godongwana says the consequences for the country would be “severe and far-reaching”
Responding to the DA and EFF’s applications to prevent the VAT increase from coming into effect on Thursday, 1 May 2025, Godongwana has defended his decision to increase the VAT rate in terms of section 7(4) of the VAT Act.
He said that the 2025/26 Budget was based on the assumption that the 0.5 percentage point VAT increase would generate about R13.5bn additional revenue for this financial year.
April 21, 2025
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