Cosatu first to oppose VAT increase in Parliament’s budget hearings

Cosatu members protests against VAT hike in Johannesburg on March 20, 2025.

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The Congress of South African Trade Unions (Cosatu) was the first organisation at the public hearings on the 2025 budget today to call for the removal of Value-Added Tax (VAT) hikes.

Parliament’s Joint meeting of the Standing Committee on Finance and Select Committee on Finance are hosting public hearings on the budget that was tabled by Finance Minister Enoch Godongwana earlier this month.

The February tabling of the budget was postponed due to disagreement among Government of National Unity (GNU) members, including the African National Congress (ANC), over a proposed 2 percentage point VAT increase.

The consequent budget was tabled with a 1% point increase over two financial years.

Cosatu’s Parliamentary Coordinator Matthew Parks has called for its removal.

“We appreciate less than 2% but still feel that the VAT hike hit the working class, drowning them in debt. Also concerned about not adjusting tax bracket for middle income, who, again, are struggling to survive the high cost of living. Propose Parliament remove VAT hikes, adjust PIT (Personal Income Tax) for lower incomes, and if we cannot at SARS (South African Revenue Service), make sure the wealthy pay their fair share.”

An activist group, Amandla Dot Mobi, says Godongwana had access to many other options for tax, before deciding on increasing the VAT.

During the hearings, the group’s Tlou Seopa says, “The fact that Minister Godongwana is increasing VAT in the time of a rising cost of living crisis is a matter of concern. If he actually listened to experts and the poor majority, and cared for the people, he would’ve increased the sugary drinks tax, CPI (Consumer Price Index), and pit for the super rich.”