Most Political Parties Reject Godongwanas Budget Over 0.5 Vat Hike

The majority of political parties in Parliament have rejected Finance Minister Enoch Godongwanas 2025/2026 budget, mainly opposing the 0.5 VAT increase over two years.

Godongwana has tabled a budget that proposes a hefty tax increase on alcoholic beverages and tobacco-related products. Hes also announced a one percentage point Value Added Tax hike over two years. This, he says, is to raise R28 billion of much-needed revenue for this year.

While African National Congress ANC Chairperson Gwede Mantashe supports the budget, United Democratic Movement UDM Chief Whip Nqabayomzi Kwankwa and African Christian Democratic Party ACDP MP Steve Swart have voiced their opposition.

The budget talks to the issues of our people. I heard the party that says this budget is not pro-growth. And I ask a simple question: how can you spend money on education, health infrastructure, social grants and say its against growth. We are effectively paying more tax to the fiscus. One of the issues that we are concerned about is how do you budget for a VAT over two years and the plan is intended to grow the South African economy.

Swart adds, It means there is no confidence in the plan that is being tabled here. Because the minister is making a number of projections around economic growth and also financing SARS, which is very important. So that they can be able to collect revenue. We do not support the VAT increase of one percent over two years. We believe there are other ways of saving money and collecting the revenue that is due to SARS. Its R800 billion that is due to SARS.