Parties slam DA for claiming victory over VAT reversal

Finance Minister Enoch Godongwana confirmed in a statement on Thursday that the VAT rate will remain at 15%, shelving the proposed 0.5 percentage point hike which was set for the 1st of May. 

The African National Congress (ANC) said it has learnt its lesson on how to handle matters of the budget in a coalition government. 

Speaking at a joint press briefing on Thursday morning, ActionSA, the National Coloured Congress, and GNU parties, excluding the DA, the ANC's Secretary General, Fikile Mbalula, said his party is in good spirits with the reversal of the VAT hike. 

“We welcome, as the ANC, the statement of the treasury without disruption and instability because the interests of South Africans come first,” said Mbalula. 

“Our views in these discussions were defending the expenditure side of the budget, in the interest of breaking the austerity cycle.” 

Mbalula said that without the VAT increase, the presented budget was the best amongst other budgets ever presented. 

“This budget addresses the question of growth in terms of the economy, it cushioned the poor in terms of investing in social expenditure, it cushioned us against austerity.” 

The parties represented at the briefing all agreed that the DA’s court case did not influence the reversal of the VAT, adding that the party was claiming an undeserved and easy Victory. 

ActionSA

ActionSA leader Herman Mashaba said VAT reversal was achieved by political parties that were willing to put their differences aside and demonstrate the maturity required to find an alternative to a VAT increase. 

Mashaba says small parties of the GNU and the NCC made substantive submissions of revenue alternatives to the Finance Minister and began a series of engagements with the ANC. 

During these engagements, both parties publicly committed to a VAT reversal before 1 May 2025.

“There will be no VAT increase, not because of any court case that opportunistic parties now seek to falsely claim credit for. But because of principled, good-faith negotiations, grounded in substance rather than extortionist, unpatriotic, and shamelessly dishonest politics,” said Mashaba. 

“ It is highly appropriate for me to acknowledge the ANC and the Finance Minister for their role in our negotiations. Our engagements were conducted in good faith, with maturity, and with the best interests of the country in mind.”

Rise Mazansi

Rise Mzansi leader Songezo Zibi said the reversal VAT increase freed Godongwana from extortion by the DA. 

“This union of political parties to find a solution means that the Finance Minister and Parliament are now free to proceed with the rest of the Budget process without being held hostage by narrow political priorities that serve to undermine existing legislation – such as making South Africans wait longer for land justice, and limiting the diversity in the country’s schools.”

Patriotic Alliance 

The PA’s Kenny Kunene said that the DA initially agreed to 0.5 % VAT increase should the ANC scrap the National Health Insurance Act, the Basic Education Law Amendment as well as privatise some state-owned entities. 

Kunene added that the DA has no moral right to claim the VAT reversal victory because it tried to use it to extort the treasury.

Meanwhile, in a press briefing held earlier on Thursday, DA Federal Chairperson Helen Zille said the finance minister’s abrupt backtrack was triggered by legal pressure following the party’s court challenge to halt the increase. 

Zille told the media the DA’s legal and political action ensured South Africans, particularly the poor and working class, were spared an unjustified tax burden. 

The DA and ANC are set to meet on Friday. 

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