CLEMENT MANYATHELA: Was ActionSA duped by the ANC?

I think Action SA has been deceived and tricked by the ANC, into believing that the finance minister will rework his budget and remove the VAT hike before it gets implemented on 1 May. 

What confirms this for me are the statements that have been made by ANC leaders and other Government of National Unity (GNU) partners about VAT being a temporary measure. It appears the ANC and other GNU partners, except the DA, are clear and resolved on the VAT hike, and ActionSA is the only party that still hopes that the finance minister will come back with another plan. I don’t think that’s going to happen, and I am going to demonstrate to you why I believe this. 

A part of me believes the ANC played ActionSA. Another part of me believes ActionSA knew exactly what they were doing. They knew that VAT would go up and that they couldn’t stop it, but they were playing the long game. I don’t know for sure what their intention behind the move was.

Action SA was insistent on the fact that come 1 May, VAT doesn’t come into effect. But Rise Mzansi, the IFP, and others have accepted that it will come and be temporary. But that’s not what ActionSA signed up for. The more I look at the legislation, the more I realise the impracticality of reversing VAT within three weeks. I don’t know how ActionSA explains this to its voters, the same ones it released a statement to, saying, ‘We saved you from VAT’. Come 1 May, what are they going to say to their supporters? We lied to you? Sorry, we were played? For their sake, and honestly, for the sake of South Africans, I hope the ANC lives up to its promise to ActionSA. 

National Treasury went ahead and introduced the Rates and Monetary Amounts and Amendment of Revenue Laws Bill on Friday by notice in the Government Gazette.

The draft bill, as published on 12 March, provides for the highly disputed VAT increase, the expansion of the list of zero-rated items, increases in sin taxes, and adjustments to tax brackets.

ActionSA proposed a 30-day window period in which to find alternative revenue sources to the VAT increase and higher income tax for individuals through bracket creep in exchange for its yes vote.

The question is: Does ActionSA know that it voted in favour of the fiscal framework containing the VAT and other stealth tax increases? Do they realise that the increases are contained in the draft bill?

Also, the National Assembly is on recess for two weeks until after the Easter weekend. The finance minister could withdraw the bill - that would be the quickest and doesn't require parliamentary action. But he wouldn't be able to immediately replace it with anything else in that short space of time.

Parliament’s first term ended last Friday, so they are in recess until 22 May. When they return, it's committee week from 22 to 25 April and then - wait for it - they go on another break immediately because of the long weekend. The earliest they will sit down is on 6 May.

Unless you can have it reversed in October. Between now and October, we are stuck with it. If he announces the new VAT rate is 15%, it becomes effective as soon as he calls the date.