{"id":821799,"date":"2025-04-23T09:00:00","date_gmt":"2025-04-23T07:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=821799"},"modified":"2025-04-23T08:27:22","modified_gmt":"2025-04-23T06:27:22","slug":"no-vat-increase-for-south-africa-needed","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/821799\/no-vat-increase-for-south-africa-needed\/","title":{"rendered":"No VAT increase for South Africa needed"},"content":{"rendered":"\n

Renowned economist Dawie Roodt said the state collected nearly R10 billion more in taxes than expected, which means it does not need to increase value-added tax (VAT).<\/p>\n\n\n\n

Roodt shared this information during a Biznews interview<\/a> about the current battle regarding the planned 0.5 percentage point VAT increase.<\/p>\n\n\n\n

On Tuesday, South Africa\u2019s High Court heard an application filed by the DA and EFF that seeks to stop a proposed VAT hike.<\/p>\n\n\n\n

The court reserved judgment in the lawsuit to interdict the authorities from raising VAT by half a percentage point from 1 May 2025. It expects to deliver its ruling by 29 April 2025.<\/p>\n\n\n\n

\u201cWe oppose a bullying budget that will lead to more young people losing hope when they realize they will be poorer than their parents,\u201d DA finance spokesman Mark Burke said.<\/p>\n\n\n\n

\u201cWe oppose a bleeding budget that will lead to more South Africans wondering why their house value has gone down for another year in a row.\u201d<\/p>\n\n\n\n

The battle raised investor uncertainty about the stability of South Africa\u2019s government of national unity.<\/p>\n\n\n\n

Finance Minister Enoch Godongwana said scrapping the VAT hike would leave a budget hole that would have to be filled by borrowing.<\/p>\n\n\n\n

This, in turn, will sap fiscal discipline and impose a lasting cost on the country\u2019s finances, and he sees no viable alternative.<\/p>\n\n\n\n

However, Roodt disagrees. He said the South African Revenue Service (SARS) collected around R10 billion more than expected in the previous financial year.<\/p>\n\n\n\n

On 1 April 2025, SARS announced<\/a> a positive preliminary revenue-collection outcome for the 2024\/25 fiscal year.<\/p>\n\n\n\n

By the end of March 2025, SARS had collected a record gross amount of R2.303 trillion, representing a 6.9% year-on-year growth.<\/p>\n\n\n\n

SARS paid refunds of R447.7 billion to taxpayers, which brought the collected net amount to R1.855 trillion.<\/p>\n\n\n\n

This is almost R8.8 billion higher than the revised estimate, and R114.0 billion more than last year\u2019s R1.741 trillion.<\/p>\n\n\n\n

\u201cHalf a percentage point increase will raise around R10 billion. That means the state has the money. We don\u2019t need to increase VAT,\u201d Roodt said.<\/p>\n\n\n\n

\u201cThere was an overrun in the previous financial year, which is enough to prevent the planned VAT increase.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

Renowned economist Dawie Roodt said the state collected nearly R10 billion more in taxes than expected, which means it does not need to increase value-added tax (VAT).<\/p>\n","protected":false},"author":10,"featured_media":820023,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[1459,17448,19922,7438],"class_list":["post-821799","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-dawie-roodt","tag-enoch-godongwana","tag-south-african-revenue-service-sars","tag-vat"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/821799","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=821799"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/821799\/revisions"}],"predecessor-version":[{"id":821800,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/821799\/revisions\/821800"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/820023"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=821799"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=821799"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=821799"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}