Cape Town – ActionSA leader Herman Mashaba has expressed satisfaction after the government confirmed the scrapping of a proposed 0.5% VAT increase, just days before it was set to take effect.
The reversal followed pressure from smaller political parties, including ActionSA, which had supported the ANC’s budget on the condition that no VAT hike would be introduced and that alternative funding solutions be explored.
Mashaba, who had consistently opposed the VAT increase, described the government’s decision as a vindication of his party’s stance.
He emphasised that ActionSA had committed to a budget that would avoid burdening South Africans with higher taxes, instead seeking other revenue sources and budget cuts.
Fellow South Africans, we have kept our promise to you – There will be NO VAT increase!
Join ActionSA – alongside the ANC, IFP, PAC, Rise Mzansi, BOSA, UDM, Good Party, Al-Jamah and the PA – for a media briefing on the VAT hike reversal at 10h00 this morning -… pic.twitter.com/byh65SZQDH
— Herman Mashaba (@HermanMashaba) April 24, 2025
“ActionSA committed to South Africans that the country would have a budget, but that other revenue streams and cuts can serve to replace VAT, instead of running to the courts,” The Citizen quoted Mashaba as saying.
Meanwhile, the EFF has intensified calls for Finance Minister Enoch Godongwana’s resignation, accusing him of endangering South Africa’s economy following the controversial VAT hike saga.Although the National Treasury reversed the proposed increase — which would have raised VAT from 15% to 15.5% on May 1 — the EFF says the damage is done and labels the budget process as “misguided, reckless and unconstitutional”.
The party, which joined the legal challenge against the hike as an intervening party, insists that the reversal does not go far enough. They are demanding a complete withdrawal and reset of the national budget process.
The EFF’s Statement on the Withdrawal of the 2025 Budget and the VAT Hike
-Furthermore, the EFF calls for the immediate resignation of the Minister of Finance and the Director General of the National Treasury. This entire budget fiasco should be a reflection for the Minister of… pic.twitter.com/12mkwdOTDC
— Economic Freedom Fighters (@EFFSouthAfrica) April 24, 2025
The EFF argues that the Treasury’s focus on a rigid fiscal framework ignores South Africa’s urgent needs: job creation and economic recovery.
“South Africans need jobs and economic growth urgently, and the state is the only institution with the capacity to respond — yet the National Treasury remains obsessed with an unscientific fiscal anchor strategy that will only plunge South Africa into a deeper crisis.
“The EFF calls for the immediate resignation of the Minister of Finance and the Director-General of the National Treasury. This entire budget fiasco should be a reflection for the Minister of Finance and his Director General that they are out of depth and pose a threat to the economic stability of the country and, by consequence, are a threat to the livelihoods of South Africans,” the EFF said.
