By Johnathan Paoli
The African National Congress and the Congress of South African Trade Unions have hailed Parliament’s adoption of the 2025 Budget Fiscal Framework and Revenue Proposals as a victory for the working class and the country’s pro-poor economic agenda.
However, they both stressed the need for alternative revenue measures to mitigate the impact of proposed tax hikes.
ANC spokesperson Mahlengi Bhengu-Motsiri reiterated the party’s commitment to a progressive, people-centred fiscal framework that prioritised economic recovery and social protection.
“These principles are consistent with the ANC’s long-standing policy positions and affirm our focus on advancing equity, justice, and inclusive growth,” she said.
She emphasised that the budget should not be used for political point-scoring but should focus on addressing the needs of the most vulnerable.
The spokesperson outlined the three critical principles supported by the ANC: reconsideration of the proposed 0.5% VAT increase due to its impact on low-income households, adjustment of personal income tax (PIT) brackets in line with inflation and a 30-day window for the National Treasury to propose alternative revenue measures.
ANC ally, Cosatu, expressed strong support for Parliament’s decision to halt the budget’s proposals to increase VAT by 1% over two years and to leave PIT brackets unadjusted.
Parliamentary coordinator Matthew Parks argued that these measures would have disproportionately affected workers and low-income households.
“We welcome Parliament’s call for the National Treasury to provide alternatives within 30 days. If honoured, this will provide invaluable relief to millions of workers drowning in debt and struggling to cope with rising costs,” Parks said on Thursday.
He urged the government to respect Parliament’s resolution, warning against any delays in implementing alternatives.
“It would be a travesty if the Treasury were to ignore Parliament’s directive. This is a matter of trust, especially as we head into the 2026 local elections,” he cautioned.
It has proposed a series of alternative revenue and expenditure measures to raise funds without burdening the working class.
These include closing tax loopholes exploited by the wealthy, increasing taxes on high-income earners, inheritance and luxury goods, and strengthening tax collection efforts.
The federation also suggested leveraging state-owned financial institutions, such as the Development Bank and the Industrial Development Corporation, to finance infrastructure projects.
It called on the SA Reserve Bank to provide more direct fiscal support and cost-cutting measures targeting government spending on executive perks, travel and consultants.
The ANC and Cosatu vowed to continue engaging with Parliament and the Treasury to ensure that any new revenue measures were fair and did not disproportionately impact South Africa’s working class.
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