Government’s VAT Hike

A slap in the face to workers

COSATU Parliamentary Coordinator, Matthew Parks has made a submission before the Joint Standing and Select Committees on Finance Parliament Republic of South Africa in April 2018 after the federation flatly rejected the Value Added Tax [VAT] increase.

1. Introduction
COSATU is deeply disappointed with government’s VAT hike. It effectively punishes the poor for the sins of the rich. COSATU does not want to see government collapse due to its precarious financial straits.
However these are largely self inflicted by rapacious political elite and their lecherous friends. Now government has passed the bills to workers to pay. COSATU condemns the VAT hike in the strongest possible terms. We hope that government is actually listening to the anger of workers and their struggling families.

COSATU feels government took the easy route out in seeking to address its burgeoning revenue shortfalls. We feel there were many alternative options to address the shortfalls, albeit requiring harder work and creativity. Nonetheless they existed and still exist. Equally painful, is the fact that this VAT hike, the first in 25 years, is accompanied by a barrage of other tax hikes this year and over the past three years that disproportionally hurt the working and middle classes. This year’s tax hikes essentially only hurt the poor. Whilst being disdainful of government’s acute lack of sensitivity towards the struggles of workers, COSATU has several proposals with regards to cushioning the blow to the poor by expanding the list of VAT exempt goods. Read More