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A Hard-Fought Victory: Why Blocking the VAT Hike Matters for South Africa’s Future
Recently, South Africans scored a hard-fought win: the government’s plan to raise Value Added Tax by 1% was officially scrapped. On
paper, a 1% hike might not seem alarming, but for the average family already grappling with rising costs, stagnant wages, and daily
survival, it would have been a major blow. The proposed increase wasn’t even set to happen all at once. Instead, it was planned as two
quiet 0.5% increments, a maneuver seemingly designed to avoid a sharp public backlash. Fortunately, members of the Government of
National Unity, known as the GNU, intervened and stopped it before it could proceed. Without their action, South Africans today might
be facing a far steeper 2% VAT hike.
Why would a 1% increase have hurt so much? Imagine a typical monthly grocery bill of R5,000. A 1% VAT hike would mean an
additional R50 every month. That’s R600 more each year, just on food. But groceries are only the beginning. The increase would
have impacted fuel, utilities, school supplies, clothing, transportation, and countless everyday services. What looks like a minor
adjustment quickly snowballs into thousands of rand lost each year. For families already making brutal choices, between buying food
or hygiene products, that extra tax could mean literally deciding between bread or soap. In a nation where official figures now place
unemployment at 32% of adults. (Youth Unemployment (Ages 15–24): As of Q4 2024, the unemployment rate is 59.6%.) Alarmingly,
55% of citizens live below the poverty line, even a few hundred rand a month can be the difference between survival and despair.
The bigger issue, though, goes beyond the VAT proposal itself. It points to a government increasingly out of touch with the realities
faced by ordinary South Africans. Many leaders advocating for the VAT hike live insulated lives, worlds apart from the people they
govern. Their rent, electricity, petrol, and personal security are all funded by the taxpayer. They drive luxury vehicles, Range Rovers,
BMW X5s, Mercedes-Benz G-Classes, while ordinary citizens navigate roads pockmarked with potholes large enough to swallow small
cars. Their salaries, often exceeding R100,000 per month, come with a range of perks and bonuses. For them, the cost of bread or a
trip to the store is a distant, almost abstract concern. And when you don’t worry about these basics, it becomes all too easy to
label a tax increase as “necessary for development.”
But where is all the existing money going? South Africans already shoulder a heavy tax burden: personal income tax, capital gains tax,
dividends tax, estate duties, and, of course, VAT. Yet, critical public services continue to collapse. Load-shedding cripples homes and
businesses alike. Potholes wreck cars and endanger lives. Hospitals struggle to provide even basic supplies like bandages and
antibiotics. Schools, particularly in rural areas, crumble, some still relying on unsafe and outdated pit toilets. State-owned enterprises
like Eskom, South African Airways, and Transnet remain financial black holes, drained by years of corruption and mismanagement. The
Zondo Commission and other investigations have revealed how billions of rand were siphoned from public coffers. Yet, how many
major political figures have been jailed for these crimes? Almost none.
The real cost of corruption isn’t just visible in crumbling infrastructure or failing services. It’s measured in dreams deferred, futures lost,
and lives cut short. It’s seen in the children denied a quality education. In the young adults unable to find work. In the patients who die
waiting for an ambulance that never comes. Had South Africa’s tax money been managed properly, the nation could have free, quality
education for all, modern and well-equipped hospitals, reliable electricity and water supply, and true social security for its most
vulnerable citizens. Instead, the country faces the highest youth unemployment rates in the world, a shrinking middle class, and
infrastructure that deteriorates by the day.
The blocking of the VAT increase is a victory, but it must also serve as a warning. History shows that when one plan to raise money is
defeated, another often lurks just around the corner. Whether it’s a new fuel levy, a so-called “temporary” electricity surcharge, or
another small adjustment buried in financial jargon, the government’s hunger for easy revenue remains. South Africans cannot afford
to relax. This moment proves that public pressure and accountability can make a difference. But real, lasting change will only come
when those responsible for decades of looting are brought to justice. Until then, every cent saved, like the money spared by halting the
VAT hike, is less a favor from government and more an act of survival against a system that too often preys on its own citizens.
The halting of the VAT increase isn’t just about saving a few rands at the checkout counter. It’s a symbol of something far greater: the
power of public awareness, the critical importance of vigilance, and the desperate need for a government that serves its people, not
itself. We must keep asking the hard questions: Where is our money really going? Who is being held responsible? When will the cycle of
corruption finally be broken? South Africa deserves better. And it starts with all of us refusing to stay silent.
