The Cabinet is considering expanding the list of foodstuffs zero-rated for value-added tax (VAT) in a bid to mitigate the effect on poor people of the increase of one percentage point in the rate provided for in the February budget. Communications Minister Nomvula Mokonyane said this in briefing reporters on the cabinet meeting on Thursday. There has been an outcry among trade unions and nongovernmental organisations against the increase in the VAT rate from 14% to 15%. The hike is due to come into effect on April 1 and expected to raise R22.9bn. VAT does not apply to 19 basic food items, all of which are zero rated. Mokonyane said a team of ministers led by Finance Minister Nhlanhla Nene would look into the possible expansion of the list of zero-rated goods. Consultations would be held with civil society. She said no time-frame had been set for these deliberations. There were resounding calls in Parliament on Wednesday by the labour movement and nongovernmental organisations for th...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.