By Zukile Majova
- President Cyril Ramaphosa says the Treasury has 30 days to find alternatives to avoid VAT hike.
- Coalition tensions rise as DA and other parties reject the current national budget proposal.
President Cyril Ramaphosa has admitted that a VAT increase might be the only way to plug a R13.5-billion hole in the national budget.
He made the comments while visiting Chiawela in Soweto, where he also addressed rising tensions in his fragile government of national unity.
Ramaphosa’s warning could spark a serious fallout with his coalition partners, especially the Democratic Alliance (DA), which has already voted against the current budget.
Between the DA, Economic Freedom Fighters (EFF) and the uMkhonto Wesizwe (MK) party, the group controls more than 45% of the seats in parliament.
Last week the ANC had to rely on nine other parties just to scrape through a vote — winning by only 12 extra votes.
ActionSA leader Herman Mashaba said his party has offered the government other options to avoid raising VAT.
On Sunday, Ramaphosa said the National Treasury had 30 days to find another way.
“The resolution that was taken by the finance committee is that there will be a 30-day period during which the Treasury must examine whether there are other options other than through a VAT increase where we can fill the gap of about R13.5 billion.
“From the current examination, the Treasury has said that having looked at various areas where they can look, it doesn’t seem so,” said Ramaphosa.
He also confirmed receiving a letter from some of the country’s biggest business leaders, who raised concerns about how changes to the unity government could affect the economy.
Ramaphosa said he’s happy to work with businesses — but warned them not to interfere.
“What will not happen is for any business to give orders, to dictate what should happen because that space is the space that is occupied by people who have been elected by the people of South Africa.
“Business is not elected,” said Ramaphosa.
Pictured above: President Cyril Ramaphosa.
Image source: ANC
