By: Bright Ntuli
Parliament’s presiding officers have welcomed the agreement reached in legal proceedings concerning the proposed increase in value-added tax (VAT) and the adoption of the fiscal framework.
The Western Cape High Court has suspended the planned 0.5 percentage point VAT hike, effectively scrapping the measure. This ruling came as part of a legal challenge brought by the Democratic Alliance (DA) and the Economic Freedom Fighters (EFF), who sought to have the VAT adjustment declared invalid.
In a statement, Parliament’s spokesperson, Moloto Mothapo, said the resolution marks the end of a complex matter of significant national importance, underscoring the role of democratic institutions in resolving fiscal disputes.
The proposed VAT increase, which would have raised the rate from 15% to 15.5%, was introduced as part of the government’s broader efforts to stabilise public finances amid ongoing economic pressures.
Critics argued that it would disproportionately affect low-income households already burdened by rising living costs.
The suspension of the VAT hike clears the way for Parliament to proceed with the fiscal framework without the contested tax measure.
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