ActionSA Welcomes Fiscal Victory for South Africans as VAT Increase and Tax Bracket Creep Are Scrapped
Press Statement by Athol Trollip MP
ActionSA Parliamentary Leader
ActionSA celebrates a major victory today in our ongoing fight for a fair and responsible fiscal framework, that protects every South African from excessive taxation and worsening economic pressures.
Today, ActionSA moved a recommendation in the report that ensured the proposed 0.5 percentage point increase in Value-Added Tax (VAT) for the 2025/26 financial year has been effectively scrapped, along with income tax bracket creep. Consequently, it will be the responsibility of Parliament, together with National Treasury, to urgently finalise alternative revenue and expenditure proposals within 30 days. This marks a critical step in protecting South Africans from regressive and unsustainable tax increases.
From the outset, ActionSA has firmly opposed the proposed VAT hike, recognising its disproportionate impact on lower- and middle-income households already struggling with the cost-of-living crisis. Furthermore, the failure to adjust personal income tax brackets in line with inflation would have subjected taxpayers to bracket creep—an unjust stealth tax that erodes disposable income.
Through our recommendations in the Finance Committee’s report, which will proceed to the National Assembly tomorrow, we have ensured that substitute revenue proposals and corresponding expenditure savings are considered to offset the R28 billion shortfall from scrapping the tax increases. This will ensure that government inefficiencies are addressed before any further burden is placed on South Africans.
ActionSA will always put South Africans first. As the only constructive opposition in Parliament, we will continue to engage in providing practical solutions that advance the best interests of South Africans at every turn.
ActionSA will remain focused on cutting wasteful expenditure, curbing corruption, and prioritising service delivery over reckless tax increases. We call on all stakeholders to contribute to sustainable and equitable revenue solutions that do not compromise the financial well-being of our citizens.
ActionSA Welcomes Fiscal Victory for South Africans as VAT Increase and Tax Bracket Creep Are Scrapped
ActionSA celebrates a major victory today in our ongoing fight for a fair and responsible fiscal framework, that protects every South African from excessive taxation and worsening economic pressures.
Today, ActionSA moved a recommendation in the report that ensured the proposed 0.5 percentage point increase in Value-Added Tax (VAT) for the 2025/26 financial year has been effectively scrapped, along with income tax bracket creep. Consequently, it will be the responsibility of Parliament, together with National Treasury, to urgently finalise alternative revenue and expenditure proposals within 30 days. This marks a critical step in protecting South Africans from regressive and unsustainable tax increases.
From the outset, ActionSA has firmly opposed the proposed VAT hike, recognising its disproportionate impact on lower- and middle-income households already struggling with the cost-of-living crisis. Furthermore, the failure to adjust personal income tax brackets in line with inflation would have subjected taxpayers to bracket creep—an unjust stealth tax that erodes disposable income.
Through our recommendations in the Finance Committee’s report, which will proceed to the National Assembly tomorrow, we have ensured that substitute revenue proposals and corresponding expenditure savings are considered to offset the R28 billion shortfall from scrapping the tax increases. This will ensure that government inefficiencies are addressed before any further burden is placed on South Africans.
ActionSA will always put South Africans first. As the only constructive opposition in Parliament, we will continue to engage in providing practical solutions that advance the best interests of South Africans at every turn.
ActionSA will remain focused on cutting wasteful expenditure, curbing corruption, and prioritising service delivery over reckless tax increases. We call on all stakeholders to contribute to sustainable and equitable revenue solutions that do not compromise the financial well-being of our citizens.