Independent panel zero-rates more items for VAT
As well as some more food items, sanitary products and school uniforms may become zero-rated
The independent panel appointed to review the current list of zero-rated food items for VAT purposes has recommended additional items, including sanitary products, school uniforms, and nappies for babies and adults.Also recommended for zero-rating, in addition to the 19 food items already zero-rated, are white bread, bread flour and cake flour. The panel’s report was released on Friday by Finance Minister Nhlanhla Nene for public comment. The period for comment will close on August 31.In response to mounting pressure after the VAT increase, Nene appointed the panel, chaired by Prof Ingrid Woolard, an economics professor at the University of Stellenbosch, to look into zero-rating additional items to mitigate the effect on the poor of the one percentage point increase in the VAT rate from 14% to 15%, which was announced in the budget and which took effect from April 1. The VAT increase was strongly opposed by trade unionists, NGOs and community organisations as being a regressive mea...
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