With the State of the Nation Address behind us, all eyes are now on the highly anticipated national budget presentation in Parliament this week by Finance Minister Enoch Godongwana.
As Finance Minister Enoch Godongwana prepares to table the budget, discussions about potential tax increases have gained traction, with some experts speculating that hiking taxes may be necessary to cover the budget shortfall. However, key political and labour groups are adamantly opposed to such measures.
DA’s Stance: Focus on Growth, Not Higher Taxes
The Democratic Alliance (DA) has made it clear that it will not support any increases to personal, corporate, or value-added taxes.
Mark Burke, the DA’s finance spokesperson, emphasized that South Africans are already grappling with the ongoing cost-of-living crisis, and raising taxes would only exacerbate the financial burden on households.
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Instead, the DA calls for urgent economic reforms that would foster growth, encourage infrastructure investment, and cut wasteful government spending.
“Imposing higher taxes on an already struggling populace is completely unacceptable,” Burke said, urging the government to prioritize policies that stimulate economic growth rather than deepen the financial strain on citizens.
COSATU: Tax Increases Could Devastate Workers
The Congress of South African Trade Unions (COSATU) shares similar concerns, stressing that any increase in taxes would be detrimental to workers and their families.
Matthew Parks, COSATU’s parliamentary coordinator, warned that such a move would worsen the already difficult financial situation for many South Africans, particularly those dealing with rising living costs and the impact of a 400-basis point hike in the repo rate.
Parks also pointed out the risk that a VAT increase could stoke inflation, further diminishing purchasing power and slowing down the economy at a time when growth is needed most.
COSATU cautioned its ally, the African National Congress (ANC), that tax hikes could have significant political consequences, especially with the 2026 local government elections on the horizon.
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