Chiawelo, Soweto resident, Netshifhefhe Tshitereke feels the recently announced Vat increase will throw his budget in disarray.
(Photo: Bheki Simelane) 
Netshifhefhe Tshitereke, from Chiawelo, Soweto, said he didn’t know much about value-added tax (VAT), “but I understand the increase affects my daily life since there’s no increase in my salary”.
Like Tshitereke, many Soweto residents are concerned about how the 0.5 percentage point VAT increase, from 15% to 15.5%, due to come into effect on 1 May, could affect their budgets after years of steep price increases.
Netshifhefhe Tshitereke. (Photo: Bheki Simelane)
Several political parties have opposed the increase and offered alternatives to make up the budgetary shortfall. The DA and EFF are taking the matter to court.
Emdeni resident Alfred Manzini said, “The proposed VAT increase is nothing short of daylight robbery. I stand firmly with those who reject it. This decision, marked by glaring ignorance from leadership, will burden every South African. We must unite in opposition, especially when viable, taxpayer-funded alternatives remain unexplored.
“The VAT increase will affect how things are run, not just in my household but across the country where the VAT will be felt, because I do not believe the rich are affected as badly as you and me.”
Read more: How the DA and EFF plan to fight the VAT hike and Budget process in court
Soweto residents told Daily Maverick the government should rather increase taxes on those with high incomes or raise sin taxes.
“I’m not suggesting that the poor should be exempt from taxes,” said Melokuhle Mahlangu.
“What I’m advocating for is balance. This balance would see the fiscal axe swing towards the rich, while boosting revenue through sin taxes.”
Food costs
Mandisa Majoro voiced her frustration with the looming VAT increase, especially given that her salary had remained stagnant for the past two years. She questioned how she would pay for her groceries after price increases in recent years.
“Does the government live in the same world as us?” she asked.
“Do they not see that a VAT hike will hurt ordinary citizens? And now, their justification is that it may only apply for the current financial year — how comforting is that supposed to be?”
Majoro expressed concern about rising food costs.
“I’ve been grappling with my grocery basket lately. Just three years ago, I was spending R1,500 a month on food. That same basket now costs me R2,100. The struggle is only growing.”
Tshitereke said, “I have no idea how much more I will pay for food. This will call for strict budgeting, but will certainly throw budgets into disarray.”
Read more: Food basket even more unaffordable with the prospect of a VAT increase
Manzini added: “My budgetary plans will be adversely affected. I have no idea how much I will spend, especially on those items which are needed month to month like mealie meal, electricity and water. The government has just made our lives even harder.”
The government has said the effect of the VAT increase on low-income earners will be lessened as it’s expanding the number of zero-rated goods and services.
‘We need jobs’
Aphiwe Mthimkhulu, a Soweto mother of two, said, “I stopped budgeting many years ago when my first daughter was born.
“What is the point of budgeting when your only income is a social grant? Attempting to budget currently while I’m unemployed is just inviting more stress.
“I cannot budget on other people’s money. We need jobs. The government must immediately create work and not impose taxis on a vast majority of unemployed South Africans,” said Mthimkulu.
Read more: The Budget brouhaha and you — wallet pressure, service strain and the price of political paralysis
“It shows the government’s disregard for the nation. It’s an insult to South Africans. They might feel that given their circumstances, this was the best decision, but the truth is they were irresponsible,” said Dobsonville resident Derrick Dlomo.
Jabulani resident Mpheni Sangweni’s key concern was unemployment.
“The government must provide jobs, then let us discharge our tax responsibilities, but we must be employed,” said Sangweni.
“[The VAT increase] will not affect the rich and the thieving politicians. They don’t feel it because their pockets are always full. My question to the government is, was there no other way than to punish the poor?” DM