ActionSA threatens to abandon agreement if ANC doesn’t withdraw VAT hike

CAPE TOWN - If the African National Congress (ANC) reneges on a tacit agreement with ActionSA to retract the Value-Added Tax (VAT) increase that will come into effect next month, it will be on them, says ActionSA leader  Herman Mashaba.

While it would be near impossible for the finance minister to undo the legislative process before 1 May, Mashaba insists his party has not been duped in exchange for its votes to pass the fiscal framework.

He has warned that if the ANC doesn’t make good on its word, it can forget about getting the actual money bills over the line in the coming weeks.

As the ANC looks to reset its relationship with the Democratic Alliance which again soured last week over the VAT increase, Mashaba says it’s his party that will be the kingmaker when it comes to passing the budget.

Last week’s fiscal framework is but the first step of the budgetary process that underpins the money bills including the one on tax.

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Mashaba insists his party supported the budget blueprint based only on a non-binding finance committee recommendation that VAT is retracted.

"If ever they renege on that, South Africa will not have a budget. The minister of finance will have to start all over again, and VAT will be applicable. They would have betrayed you and the people of South Africa."

Mashaba doesn’t believe his party will come under fire from supporters if its deal with the  ANC flops.

"It’s up to ANC to accept the consequences. What is going to be interesting without ActionSA’s support, I wonder how they are going to actually pass the real budget."

The ANC says it will meet with all political parties, in and out of the GNU, to conclude budget negotiations within five days.