By Amy Musgrave
With the deadline looming on the budget vote, ActionSA announced on Tuesday that it would table a tax reversal condition on the fiscal framework to protect all South Africans.
The Democratic Alliance and the African National Congress have still not reached an agreement on the budget, which must be voted on in the National Assembly on Wednesday.
ActionSA parliamentary leader Athol Trollip told 702 on Tuesday that the ANC would back his party’s proposal following a meeting with the ANC on Sunday evening. The proposal would be made during a finance committee meeting in Parliament on Tuesday.
He said that the party would not have issued a statement on its proposal if it did not have the backing from the ANC.
“ActionSA met with the ANC on Sunday evening… to discuss the approach to the 2025/26 national budget, which we centred on ensuring it protects every South African from excessive taxation, worsening economic pressures, and declining service delivery,” ActionSA MP Alan Beesley said in the statement.
“Recognising the imperfect nature of the budget and the crisis that the GNU partners themselves have created with uncertainty around the country’s fiscal framework, which will have disastrous consequences if an impasse continues, ActionSA set aside a long list of budget reforms in exchange for its conditional support of the budget’s passage, with strict conditions.”
“The final explicit requirement for ActionSA’s strict conditional support of the budget is the removal of the VAT increase and the lack of an inflation-based adjustment to income tax brackets.”
Beesley said ActionSA would put forward viable alternatives to cover the revenue gap, which it was doing to show that protecting South Africans from unnecessary tax hikes was both possible and necessary without political grandstanding.
He said ActionSA concluded the meeting with the ANC on the understanding that its strict conditions would be supported in a manner that ensured the committee’s report directed Finance Minister Enoch Godongwana to remove the tax increases.
So far, Godongwana is sticking to increasing VAT by 0.5 percentage points for this financial year, and a further 0.5 for next year.
Trollip denied speculation that the negotiations with the ANC were happening as his party was looking to join the Government of National Unity.
He said the talks were only about the budget and ensuring that it was passed.
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