VAT's happening? Nando's pokes fun at tax turnaround

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Like many South Africans, Nando’s is confused – and naturally thrilled – at government’s decision to scrap the VAT hike.

This comes amid the DA’s urgent court application to have the 0.5% increase declared unconstitutional. The party claimed the deal was called off following an out-of-court settlement offer.

However, Minister of Finance Enoch Godongwana claims that the last-minute decision was made following consultations with various political parties and “careful consideration of the recommendations” of the parliamentary committees.

NANDO’S POKES FUN AT VAT TURNAROUND

In an X post, Nando’s joined in the trending topic – the scrapped VAT increase, which was meant to be implemented on 1 May.

The cheeky chain of restaurants posted: “VAT’s happening? No one knows anymore”.

In February, Nando laughed off authorities’ failure to implement the tax increase. This was set to be announced in a delayed budget speech.

Making light of the government’s failed plans, Nando’s tweeted: “VAT gaan aan?”. It added: “Now that we’ve given our 2 cents, do we have to pay VAT on it?”.

At the time, Minister of Finance Enoch Godongwana argued that the two percentage point increase from 15% to 17% was necessary to recoup an extra R50 billion for the period of 2025/2026 to cover the costs of overruns and shortfalls within public sector funding.

GOVERNMENT TO TIGHTEN ITS BELTS

With the VAT increase out the window, how and where will the government find the “extra” cash to cover its costs?

In a statement, the National Treasury revealed that the government would now endure a R75 billion shortfall over the medium term.

It also claimed that its plans to “cushion lower income households against the potential negative impact of the rate increase” were now thwarted.

As a result, they were forced to make “expenditure adjustments” to the cabinet.

It added that to “offset the unavoidable expenditure adjustments, any additional revenue collected by SARS may be considered for this purpose going forward”.