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Finance Minister Enoch Godongwana tables the 2025 budget in the National Assembly in Cape Town on 12 March 2025.
The Economic Freedom Fighters (EFF) leader, Julius Malema says Finance Minister Enoch Godogwana does not have the powers to reverse the Value-Added Tax (VAT) increase because it was passed in Parliament.
Malema says the VAT increase must be nullified through a motion in the legislature.
Malema says, “That letter is just for passing time because when something is passed in Parliament, government cannot write a letter to withdraw what was already passed because of what we call IT separation of powers. They must go back to where it was passed and say they are taking a motion to withdraw the approval of the budget fiscal policy.”
On Thursday, Godongwana said that the 0.5 percentage point VAT would be reversed. The proposed VAT increase has ruffled feathers with the Democratic Alliance (DA) and EFF applying to interdict it in court, and some other parties in Parliament voting in support of it, pending conditions that the proposal would be revised.
Godongwana also tabled the Rates Bill, responsible for setting out different kinds of taxes.
The Executive Director at the Parliamentary Budget Office, Dr Dumisani Jantjies, says documents submitted by Finance Minister Enoch Godongwana in Parliament indicate that the Value Added Tax would remain at 15%.
“In terms of the announcement he made yesterday morning and followed through with the bill, he announced that the VAT will remain 15%. In terms of the law that governs him and the powers that he has, it has to be given effect to.”
Related video | Godongwana on U-turn announcement on reversing VAT hike:
Reporting by Mapitsi Botlhoko.
