South Africa’s finance minister delivered a budget that tried to balance serving the public interest, while maintaining the stability of public finances.
The review of South Africa’s list of zero rated VAT items faces a tricky challenge of shielding the poor while ensuring that the relief isn’t exploited.
The South African government should weigh its decision carefully whether to increase value added tax (VAT) as indirect taxes fall most heavily on the poor and the middle class.
History tells us it’s better for countries to get their GST right to start with, rather than try to broaden the base later.
Natalie Boog/AAP
Value added tax (VAT), virtually non-existent before 1960, has been the predominant form of consumption tax since the mid-1980s. Given that more than 160 countries now have a VAT, it is hardly surprising…