We need jobs, not more taxes: Steenhuisen

Democratic Alliance Federal Leader John Steenhuisen says that the unprecedented move to delay the 2025 National Budget highlights the ‘new normal’ facing the country.

Steenhuisen said the budget was delayed amidst concerns that, in its current form, it did not speak enough about growth and jobs, instead focusing on cuts and taxes.

“We need more jobs, not more taxes. We said very clearly that a budget that contained a 2% VAT increase would not enjoy the support of the DA, and we would not vote for it in parliament.”

“A responsible decision has therefore been made to postpone the tabling of the Budget. This will allow the GNU partners to try and find each other on how we can put on the table a pro-growth budget.”

The Minister of Agriculture added that a 2% VAT increase would have been completely regressive, increasing the burden on already cash-strapped South Africans.

He said that the focus on a new budget will prioritize jobs and growth, which should alleviate the cost of living, not worsen it.

“It’s now time for South Africans to move beyond the timid tinkering around the edges of tax or cut. We need to start to make bold reforms to take the country’s economy out of the doldrums.”

He added that the DA will meet with fellow GNU members to discuss a new budget, highlighting that South Africa is no longer in a period where one party can just bulldoze anything it wants through parliament.

The increase in VAT comes amidst a challenging time for the National Treasury, which is trying to squeeze as much as it can out of the nation’s tax base amidst a projected R300 billion shortfall.

Despite the challenged state of South Africa’s coffers, many experts did not expect a rise in VAT to be announced during the 2025 National Budget.

Speaking at a media roundtable, experts from Deloitte said that an increase in VAT from 15% to 17% was unlikely, even if it was seen as the easiest way to increase the state’s coffers.

The experts argued that an increase in VAT would have affected the poorest people in South Africa the most.

Ania Strydom from PaySpace also did not predict a jump in VAT, as it took considerable pressure to increase VAT to 15% in 2018.

However, a leaked document from SARS showed that an extension of the zero-rated list would occur if the National Treasury was allowed to table the Budget.

The zero-rated items are exempt from VAT and currently include 19 food groups, products under the general fuel levy, and rented residential accommodation.

SARS’s document showed that a zero VAT rating would be introduced on specific edible offal, unflavoured dairy liquid blends, and canned and bottled vegetables to assist poor households.

Finance Minister Enoch Godongwana has announced that the 2025 budget will now take place on 12 March.