Standing Committee on Finance endorses DA plan to cut VAT on food
14 November 2023
The DA notes that the Standing Committee on Finance has endorsed our proposal to expand the zero-VAT-rated food basket. This will alleviate financial pressures on households who are battling to put food on their tables.
The recommendation is set against a backdrop of stunted economic growth, a widening budget deficit, expenditures on a bloated public sector wage bill and ongoing bailouts to failed State-Owned Enterprises.
The DA now calls upon the Minister to act on the Committee’s recommendation. Specifically, the basket must be expanded to include essentials such as bone-in chicken, beef, tinned beans, wheat flour, margarine, peanut butter, baby food, tea, coffee, and soup powder.
The National Treasury has, since the MTBPS earlier this month, indicated that government will have to consider the implementation of additional tax measures to offset large revenue shortfalls over the medium term. However, thus far the Minister has declined to provide definitive answers about the looming tax hikes. While he claims it's premature to discuss tax adjustments ahead of the 2024 National Budget, the absence of a concrete response suggests possible taxation increases are on their way.