VAT hike will hurt poor South Africans, warns MKP

MK Party Gauteng Youth Leader, Bonginkosi Khanyile, has warned that increasing VAT by 2% would significantly reduce the buying power of working-class and young people.

He made the remarks in Tshwane as the MK Party marched to the National Treasury to protest the rising cost of living.

The demonstration comes ahead of Finance Minister Enoch Godongwana’s delayed budget speech on Wednesday, which stalled after GNU partners failed to reach an agreement over the VAT increase. 

Khanyile emphasised that, under the current system, the poor will continue to get poorer while the rich benefit.

He’s called for VAT to be reduced, from its current rate of 15% to 14%.

Among its demands, the MK Party is calling for more zero-rated goods, which it says would provide much-needed relief to the poor.

MK Party MP, Lucky Montana, says it can’t be that the majority of South Africans are spending most of their income on necessities, including food and electricity. 

Their plea comes as the Finance Minister gears up for his budget speech on Wednesday, which many hope will balance the needs of the poor as well as the health and education sectors.

Another MK Party MP, Mzwanele Manyi, says instead of increasing the burden on the poor, government should be punishing those wealthy organisations who are evading tax. 

“Government needs to work with SARS to raid all these companies that are evading tax; R400 billion they are owing. They need to make sure SARS is properly capacitated,” he said. 

“Secondly, there is scope to do wealth tax. There are people sitting comfortably in Camps Bay that won’t even feel it,” he added.