Godongwana cancelled the tabling of the budget in February just minutes before he was meant to appear in parliament. The cabinet had rejected his proposal of a 2-percentage point increase on VAT.
The ANC is said to be “warming up” to a half percentage point VAT increase. One insiders said the party would likely “shop” for support outside the GNU should the DA reject another proposal by treasury.
The insider said they believe the EFF could be convinced to support the budget “if compromises are made”.
[Sunday Times](https://www.timeslive.co.za/sunday-times/news/politics/2025-03-09-godongwana-stands-firm-on-vat-hike/) reported this week Godongwana was standing his ground on a tax increase, insisting he needs the extra revenue to fund the “Covid grant” and ruling out any other form of a tax hike.
The report stated less than one percentage point, possibly half, would be proposed according to insiders. This would be followed by similar-sized hikes in the next two years.
A two percentage point VAT increase would have raised an additional R60bn. The Treasury has budgeted R35bn in 2025/26 as an addition to the baseline to fund the grant introduced at the height of the Covid lockdowns but has not made provision for it for the two outer financial years.
_This is a developing story_
**TimesLIVE**