ANC govt now opposes cutting VAT on food, keeping prices high

10 November 2022

In his response to my Parliamentary question the Minister of Finance, Enoch Gondongwana, has confirmed that he has zero intention of convening a panel that would analyse the expansion of the zero-VAT rated food basket.

The Minister has now formally confirmed that poor South Africans don’t get priority when National Treasury’s expenditure framework is developed.

His reply comes after he clearly stated in Parliament that he will do so upon request. After which I wrote to the Minister to formally request him to convene an expert panel to analyse the expansion of the zero-VAT rated food basket.

The Minister has not responded to my letter. In fact, in light of recent events it is evident that he has reneged his initial statement and in doing so he has misled Parliament, a most serious transgression.

To alleviate the plight of the most vulnerable South Africans the DA proposes that Government drops VAT on more food items commonly purchased by the poorest 50% of households, which include bone-in chicken, beef, tinned beans, wheat flour, margarine, peanut butter, baby food, tea, coffee and soup powder. This will help poor households to stretch food budgets further and enable the purchase of more nutritious food.

In the mid-year budget, the Minister did not mention the cost of living, or the food price, or the cost of transport – not even once. Instead, he reiterated the importance of so-called “trade-offs”. He held the party line and announced that R30 billion will be allocated to bail out the failed SOEs Denel, Transnet and SANRAL.

The Minister also announced that – without the consent of the public – up to R 260 billion of Eskom’s debt will be transferred to the national balance sheet. A blatantly desperate attempt to ensure that he and his President remain in office come the ANC’s national conference at the end of this year

This after his “tough love” maiden speech that promised to end this corruption. Instead of tackling the most pressing problem for South African households, he sold out South Africans to his ANC cadres whose patronage networks are drying up fast and are in dire need of the hard-earned taxpayer’s funds to keep them afloat.

The DA understands that vulnerable South Africans are suffering under an uncaring Government, and we will not rest in our pursuit to pressure the Minister and hold him to account for dismissing the plight of South African households.

Issued by Dion George, DA Shadow Minister of Finance, 10 November 2022