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A shopper looks at grocery items in Johannesburg, South Africa, June 17, 2020.
South Africans are having to cut back on food to keep the lights on. This is according to the chief legal officer at Debt Rescue South Africa, Annaline van der Poel. Van der Poel says these were the findings of a survey that Debt Rescue South Africa had conducted.
This is as the nation awaits an official announcement on the zero-point-five percentage point increase in Value Added Tax (VAT), which Finance Minister Enoch Godongwana announced in the 2025 Budget, which he delivered in Parliament last month. Van der Poel says the outlook for households with the pending VAT hike is looking bleak.
“We did a survey very recently to just get an idea of what consumers are going through. Particularly looking at the effect of the electricity price hike that’s just come in. And it’s been absolutely shocking to see the choices that consumers are having to make and people are cutting back on essentials like food and transport so they can keep their lights on. And this was before the electricity hike had even kicked in. So now you are adding another 12.7% tariff hike. We’ve got a cost-of-living crisis, we still have that hangover that we are stuck with, and unemployment. So disposable income is shrinking, and realistically, it’s really crashing household finances.”
WATCH: Consumers are cutting back on essentials in order to keep the lights on
