Mbalula says the new budget won’t include VAT adjustment

JOHANNESBURG - With Finance Minister Enoch Godongwana preparing for yet another budget speech, the African National Congress (ANC) hopes to avoid a repeat of the recent budget impasse.

On Wednesday, Godongwana announced that he will table a revised budget in Parliament on 21 May 2025.

ALSO READ: South Africans shaped VAT reversal: 'When people speak, we must listen' - Godongwana

This follows a ruling by the Western Cape High Court, setting aside the adoption of the fiscal framework and suspending the 0.5 % value-added tax (VAT) increase.

ANC secretary general Fikile Mbalula says while the new budget won’t include a VAT adjustment, the party hopes it will still address the needs of the poor.

"To ensure that we have a budget that reflects a conscious decision to protect the most vulnerable while ensuring that the budget remains a tool for inclusive growth, job creation and economic reconstruction."

He says the National Treasury must now focus on tabling a well-structured budget.

The ANC further says it won’t take the blame for the two-month-long budget impasse, pointing out that it was also opposed to the value-added tax increase.

This is despite the party’s vote favouring the fiscal framework in Parliament to make provision for a 0.5% VAT hike.

The ANC's NEC member, Zuko Godlimpi, said the VAT hike was a proposal from National Treasury and not the ANC.

"All political organisations rejected the 2% VAT increase. It’s a fact. That is why the 19th February budget speech was postponed. It was not at the behest of any court action. It was an agreement from all political parties, led by the deputy president, that the cabinet does not agree with the proposal by the National Treasury."