ANC denies tricking ActionSA into supporting Finance Minister’s fiscal framework

JOHANNESBURG - The African National Congress (ANC) has denied tricking ActionSA into supporting the Finance Minister’s fiscal framework, which makes provision of a 0.5% Value-Added Tax (VAT) increase.

Last week, ActionSA assisted the Government of National Unity (GNU) to pass the policy framework in Parliament after the Democratic Alliance (DA) and Freedom Front (FF) Plus voted against it.

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However, it says it only supported the framework because the ANC had agreed to withdraw the VAT increase.

ANC secretary general Fikile Mbalula presented outcomes of the party’s national working committee (NWC) at its Luthuli House headquarters on Tuesday.

While it’s highly unlikely that the VAT increase will be scrapped before it comes into effect on 1 May, ActionSA remains optimistic that the ANC will follow through on reversing it.

Reversing the VAT hike would require legislative changes, but the tight deadline makes this a difficult task.

The ANC and ActionSA had agreed to cancel the VAT increase within 30 days of passing the fiscal framework, but finding alternative revenue sources has proven to be a challenge.

Mbalula insists that this does not mean the party misled ActionSA.

"Mashaba must relax. He is not being duped. We’ll engage with him and we’ll continue to engage with them, and we remain committed to what we agreed on during our negotiations."

ActionSA says it will only consider joining the GNU once the VAT hike is scrapped.