Cape Town — uMkhonto weSizwe (MK) Party members and supporters took to the streets on Monday and marched to the offices of the South African Reserve Bank (SARB) to protest the proposed 2% VAT increase.
The party expressed concern over the economic strain that the proposed increase would cause on low-income households and small businesses, as the party said the government’s plan for zero-rated foods does little to alleviate the financial stress on citizens, TimesLIVE reported.
“We are not opposed to the zero-rating of some foods, but we are saying that it is not enough. There shouldn’t be a trade-off between zero-rating food and increasing VAT. Increasing VAT brings inflationary pressure, especially on poor people, who not only need food but are also burdened with other essential costs such as transport and electricity. This thing about zero-rating the food basket is generally a smokescreen,” MK spokesperson, Mzwanele Manyi said.
Manyi said the party was not entertaining any sort of VAT increase, and said there are alternate ways to raise funds for the budget without burdening the poor. He suggested tackling illicit financial outflows and transfer pricing. He said the South African Revenue Services (SARS) was also key to boosting revenue collections.
“Sars is ready to collect R800bn. All the government needs to do is support Sars in its efforts and the financial pressure can be alleviated,” he said.
According to The Citizen, African National Congress (ANC) secretary-general Fikile Mbalula responded to MK’s protests and said the protests do not provide any solutions.
“We see people protesting and raising issues and all of that. It’s nice to protest about anything, but they don’t provide solutions,” he said.
“Others say tax the wealthy and corporate tax; it has been happening, and that is it. The fundamental question before us is how we address the shortfall,” he added.
Mbalula said the ANC remains in full support of Finance Minister Enoch Godongwana and reaffairms the position that he would present the budget with the backing of all GNU partners.
“We support the minister and working with everybody, at the level of government and the government working with everybody, we are confident that it will produce a budget,” he said.
He said ANC officials did not meet with Godongwana to discuss the finalisation of the budget.
“We want the minister to deliver the budget on Wednesday, and we keep ourselves abreast about what challenges we are facing from the point of view of this budget, and we discussed it in that context,” he stated.
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Compiled by Matthew Petersen
