Parliament files affidavit to WC High Court contending Godongwana's powers regarding VAT
Parliament has filed a supplementary affidavit to the Western Cape High Court contending that the minister’s powers regarding VAT fall outside of Parliament’s processes, and are not dependent on the contentious fiscal framework passed earlier this month.
Finance Minister Enoch Godongwana delivered the national budget for 2025 in the National Assembly on 12 March 2025. Picture: Phando Jikelo/Parliament
CAPE TOWN - As the legal quandary persists over whether the finance minister’s decision to reverse a value-added tax (VAT) increase can be done by mere announcement, or having introduced a new bill this week, Parliament has moved to clarify its position.
It has filed a supplementary affidavit to the Western Cape High Court contending that the minister’s powers regarding VAT fall outside of Parliament’s processes, and are not dependent on the contentious fiscal framework passed earlier this month.
This submission follows additional filings to the court by the Democratic Alliance (DA) and Economic Freedom Fighters (EFF) on Friday - which took the minister to court on Tuesday - to stop the VAT hike.
On Thursday, the finance minister backtracked on his 12 March announcement to increase VAT by 0.5%.
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However, legal questions remain over what should happen next to stop the 1 May implementation.
Parliament’s chief legal advisor, Zuraya Adhikarie, says the DA’s issue with the fiscal framework that underpins the budget is not a prerequisite for announcing or reversing a VAT increase.
She says the finance minister has this power under the VAT Act and, therefore, can make such an announcement before or after the proceedings of any of Parliament’s finance committees.
Adhikarie thus argues the court does not need to set aside the fiscal framework over the VAT debacle.
However, she says, following the minister’s withdrawal of the two main budget bills (the Division of Revenue and Appropriation bills), it’s clear a new fiscal framework will have to be tabled.
But she adds that a court order is not necessary to ensure this happens, and Parliament can achieve this according to its rules.
Parliament says should the court, nevertheless, decide to set aside the fiscal framework, it should be because it has now been overtaken by recent developments.
Adhikarie says following the court’s judgment expected on Tuesday, Parliament will act as promptly as possible to adopt a new or amended fiscal framework regarding the revised money bills.