Sowetans react to the proposed VAT increase of 0.5 per cent
Sowetans are sounding off about the proposed VAT increase. For many, it is a harsh reality that will mean cutting expenses and prioritizing necessities over wants.
Finance Minister Enoch Godongwana has announced a gradual increase in South Africa’s VAT rate to address pressing spending pressures in areas like health, education, transport, and security.
The plan involves a 0.5% increase in VAT for the 2025/26 financial year, followed by another 0.5% increase in 2026/27, bringing the VAT rate to 16%.
Considering the potential impact on households already facing high food and fuel prices, as well as rising electricity and transportation costs, the government plans to provide social grant increases above inflation and expand the basket of VAT zero-rated food items.
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Soweto Urban engaged residents to find out how they plan to adjust their budget to accommodate the VAT increase.
Mqhawe Dlamini: “First of all the government does not consider its people, they do what benefits them and we suffer on the ground with the increase of VAT it means I am going to have to cut some of my expenses and only prioritize important things since almost everything will be expensive.”
Nhlanhla Zwane: “The increase of VAT affects us negatively. As someone who lives by hustling and peace jobs, it means I am going to have to work two times harder for me to be able to afford my needs.”
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Rolivhuwa Kwinda: “I am a 27-year-old student from Diepkloof Zone 2 and a part-time worker, I plan to prioritise my needs over wants because I need to save money for the future.”
Lethabo Pheto: “The VAT increase is a burden to me because I am not earning enough money as a part-time employee. I do not even have a budget; I have a lot of responsibilities.”
