Big opportunity to provide relief from Vat on food products

[James]

The proposed expansion of the range of zero-rated value-added tax (Vat) items offers an opportunity for the government of national unity (GNU) to be innovative in its efforts to positively impact the lives of economically struggling taxpayers.

Vat plays an important role in South Africa, being one of the two largest income-generating taxes for the state at R445 billion for the 2023/24 tax year.

However, it is also seen as a regressive tax, affecting the poorer segment of society harder than the rest.

An analysis for the Davis Tax Committee in 2018 indicated that the poorest 40% of South African households spend roughly a third of their income on food, whereas the richest 10% of households spend only 5%.

 

Read the full article here: https://www.moneyweb.co.za/mymoney/moneyweb-tax/big-opportunity-to-provide-relief-from-vat-on-food-products/