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VAT Law Still Needs Court Review, Says RISE Mzansi’s Zibi

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RISE Mzansi leader Songezo Zibi has urged political parties not to abandon their legal challenges to South Africa’s value-added tax (VAT) system, even after the Finance Minister reversed the proposed increase.

The Treasury announced the withdrawal of the controversial 0.5 percentage point VAT hike last week following fierce opposition from coalition partners. But Zibi believes the legal debate over the constitutionality of the country’s VAT framework remains important.

The Democratic Alliance (DA) is proceeding with its court application challenging how VAT decisions are made, arguing the current legislative process may be unconstitutional. The Economic Freedom Fighters (EFF) has also taken issue with the lack of consultation.

Zibi welcomed the government’s decision to drop the VAT proposal but said the broader issue of transparency and legality around budget decisions still needs to be addressed.

“I think the court case should continue and here’s why: for the last 30 years, the budgetary process has worked in a particular way. I think the argument, substantively, thus being placed on the table is that for the entire time that process has been unlawful, and it needs to change,” Zibi said.

The DA is expected to resolve Part A of its application — which aimed to interdict the VAT increase — outside of court. However, it will still press ahead with its primary legal challenge over constitutional concerns.

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Sourced:EWN

Picture: Onkgopotse Koloti