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South Africa Rejects Expanding Vat Exemptions, Focuses on Targeted Policies to Benefit the Poor

  • South Africa rejects expanding Vat exemptions
  • Deputy minister of finance, David Masondo, states that Vat zero rating is not the best instrument to address the problem of high cost of living
  • Vat constitutes 26% of gross tax revenue in South Africa and is redistributed to the poor through government programs
  • Further zero rating would lead to Vat revenue loss which could be used to support the poor
  • Government has implemented policies to directly benefit lower-income households through targeted expenditure interventions
  • Other targeted interventions to assist cash-strapped South Africans include temporary reduction in the general fuel levy, Road Accident Fund levy for food manufacturers, and implementing reforms in the economy to bring costs of energy, rail, and ports down.


Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.


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