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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”.

By Estelle Ellis, Suné Payne, Lerato Mutsila & Ethan van Diemen

21 Apr 2025

Source: GCIS. Finance Minister Enoch Godongwana.

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.

Read the full story on Daily Maverick.

Source: Daily Maverick

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