From the outset, ActionSA has fiercely opposed any increase in VAT and the stealth tax of personal income tax bracket creep. We remain unwavering in our commitment to shielding ordinary South Africans from unjust and unnecessary tax hikes.
ActionSA chose to recommend changes to the Fiscal Framework rather than amend it outright because an amendment would have required the Minister of Finance to redo the entire Budget process. This would have caused delays, instability, and—critically—allowed the VAT increase to take effect on 1 May, the very outcome we are fighting against.
Instead, our approach allows for the necessary time to table alternative revenue proposals, and—most importantly—gazette the postponement of the VAT increase, without triggering a full Budget revision.
ActionSA led the charge in the Standing Committee on Finance to protect South Africans by tabling an amendment to the committee report, ensuring that:
– The proposed 0.5 percentage-point VAT increase is not approved.
– The removal of inflation adjustments for personal income tax (bracket creep) is not approved.
– Instead, the Committee will have 30 days to develop alternative proposals to raise the R19 billion in personal income tax and R13 billion in VAT that these measures would have generated.
This approach ensures that the government explores responsible revenue solutions without burdening ordinary South Africans with unfair tax hikes.
ActionSA’s constructive, responsible alternative keeps the Fiscal Framework intact while preventing fiscal instability and procedural deadlock.
While the ruling coalition failed to agree on a solution, ActionSA is taking the lead in protecting South Africans from unfair tax hikes. We are not just rejecting VAT and tax hikes—we are providing a practical, revenue-generating alternative.
Our solution focuses on strengthening SARS’s ability to collect revenue efficiently, broadening the tax base, and cracking down on illicit trade.
Importantly, ActionSA has proposed alternatives which include;
– SARS’s Revenue Recovery Programme, if funded with just R2 billion annually, could recover between R20bn and R50bn per year, according to SARS’s own estimates.
– The additional R1.5bn allocated to SARS in 2025/26 (and R4bn over two years) will significantly improve SARS’s capacity to boost revenue collection.
– SARS’s own figures prove the effectiveness of targeted fiscal interventions: As per SARS’s press statement yesterday, net revenue collection for the year was R8.8 billion higher than the revised estimate, and R114 billion more than the previous year. This underscores the fact that a well-funded SARS can generate additional revenue without burdening taxpayers.
This is precisely why ActionSA has been advocating for increased SARS funding since Day 1: to ensure that ordinary South Africans are not forced to bear the burden of repeated tax increases while government corruption, mismanagement, and waste continue unchecked.
Stopping the VAT Hike: A Responsible, Practical Alternative
From the outset, ActionSA has fiercely opposed any increase in VAT and the stealth tax of personal income tax bracket creep. We remain unwavering in our commitment to shielding ordinary South Africans from unjust and unnecessary tax hikes.
ActionSA chose to recommend changes to the Fiscal Framework rather than amend it outright because an amendment would have required the Minister of Finance to redo the entire Budget process. This would have caused delays, instability, and—critically—allowed the VAT increase to take effect on 1 May, the very outcome we are fighting against.
Instead, our approach allows for the necessary time to table alternative revenue proposals, and—most importantly—gazette the postponement of the VAT increase, without triggering a full Budget revision.
ActionSA led the charge in the Standing Committee on Finance to protect South Africans by tabling an amendment to the committee report, ensuring that:
– The proposed 0.5 percentage-point VAT increase is not approved.
– The removal of inflation adjustments for personal income tax (bracket creep) is not approved.
– Instead, the Committee will have 30 days to develop alternative proposals to raise the R19 billion in personal income tax and R13 billion in VAT that these measures would have generated.
This approach ensures that the government explores responsible revenue solutions without burdening ordinary South Africans with unfair tax hikes.
ActionSA’s constructive, responsible alternative keeps the Fiscal Framework intact while preventing fiscal instability and procedural deadlock.
While the ruling coalition failed to agree on a solution, ActionSA is taking the lead in protecting South Africans from unfair tax hikes. We are not just rejecting VAT and tax hikes—we are providing a practical, revenue-generating alternative.
Our solution focuses on strengthening SARS’s ability to collect revenue efficiently, broadening the tax base, and cracking down on illicit trade.
Importantly, ActionSA has proposed alternatives which include;
– SARS’s Revenue Recovery Programme, if funded with just R2 billion annually, could recover between R20bn and R50bn per year, according to SARS’s own estimates.
– The additional R1.5bn allocated to SARS in 2025/26 (and R4bn over two years) will significantly improve SARS’s capacity to boost revenue collection.
– SARS’s own figures prove the effectiveness of targeted fiscal interventions: As per SARS’s press statement yesterday, net revenue collection for the year was R8.8 billion higher than the revised estimate, and R114 billion more than the previous year. This underscores the fact that a well-funded SARS can generate additional revenue without burdening taxpayers.
This is precisely why ActionSA has been advocating for increased SARS funding since Day 1: to ensure that ordinary South Africans are not forced to bear the burden of repeated tax increases while government corruption, mismanagement, and waste continue unchecked.