South africa increases VAT, fuel levy

Finance Minister Malusi Gigaba announced increases in VAT and other taxes to generate an additional R36-billion this financial year.
Delivering his 2018 budget speech in Parliament on Wednesday, Gigaba said it was a tough but hopeful speech.
From April 1, the value-added tax (VAT) rate goes up to 15 percent from 14 and the fuel levy will rise by 52 cents a litre.
And various stakeholders expressed grief on the increment, saying it would hit the poor more.
Civil society organizations, ordinary citizens and political parties condemned the new measures.
Greenpeace Africa’s political advisor Happy Khambule said the budget failed the people of South Africa.
“A controversial 1% increase in VAT was announced, which will impact on the poorest in this country the most,” he said.
The increase would result in hiked food prices, however, Gigaba said the current zero-rating of basic food items such as maize meal, brown bread, dried beans and rice would limit the impact of the VAT hike on the poorest households.
The Study in Poverty and Inequality Institute’s Isobel Frye said the budget would inconvenience the poor.
“The poor got incredibly shortchanged in this budget…to eat enough food to to get subsistence,” she said.
Former public protector Thuli Madonsela questioned whether the budget was consistent with the constitutional commitment to eliminate poverty in the country./enca


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