VAT hike not final, alternatives being explored: Ramaphosa

African National Congress (ANC) President Cyril Ramaphosa says the Value-Added Tax (VAT) increase decision is not final, as the National Treasury has about 30 days to find possible alternative options to raise the money it needs.

The party’s president was speaking during a media briefing at Chiawelo in Soweto, Gauteng.

Ramaphosa says the party’s National Working Committee (NWC) has been tasked with discussing the next way forward for parties in the Government of National Unity (GNU) who voted against the budget on Wednesday.

Ramaphosa has added that although it’s unlikely that Treasury will be scrapping the VAT increase, the proposals from various parties are being taken very seriously.

“The resolution that was taken by the finance committee is that there will be a 30-day period during which Treasury will examine whether there are other options other than through a VAT increase where we can fill the gap of about R13.5 billion. So that has been left for discussion and examination, and in the end, we will look at all ways and means of seeing whether that is possible or not. But from the current position, Treasury has looked and said at various areas where it can look, it doesn’t seem to be so.”

Regarding the United States’ decision to impose 31% tariffs on South African goods, Ramaphosa says South Africa will not react out of spite or act out of emotion.

He says the US is a sovereign state that is entitled to take decisions, as is South Africa.

“The US, like any other state, is a sovereign country, and they are entitled to take decisions in whichever way they want. Like ourselves, we are a sovereign country, and we can decide on many matters that have to do with international dealings there, and so it is within our right, as it is within their right. They’ve imposed tariffs, and we are examining the impact of those tariffs on us. And as the Minister of Trade and Industry Competition said, we will be able to state what our position is. These are issues we will be dealing with in a very responsible and very proper manner. Everything we do, we examine very carefully and look at the implications and the impact.”