South Africa’s finance ministry has decided not to implement a planned VAT hike, initially proposed in the 2025 budget, due to political opposition. The increase, which was meant to add 1 percentage point over two years, will instead be withdrawn.

South Africa’s finance ministry announced that it will not implement the previously planned increase in value-added tax (VAT), which was set to take effect on May 1. This announcement comes after the National Treasury had initially proposed to raise the VAT by 1 percentage point over a span of two years. The decision to retract the hike was influenced by opposition from various political parties.

The South African finance ministry’s decision to withdraw the planned VAT increase highlights the impact of political opposition on fiscal policy. Initially proposed to fund budgetary requirements, the hike will not proceed as scheduled.

Original Source: www.tradingview.com