EFF calls for ‘apartheid tax’ counter instead of VAT hike [VIDEO]

As the battle over the value-added tax (VAT) hike plays out in the Western Cape High Court, the EFF has proposed an “apartheid tax” for people who inherited wealth during that era.

The DA approached the court to have the 0.5 percentage point VAT increase announced by Finance Minister Enoch Godongwana in his Budget Speech in March set aside and to interdict its implementation on 1 May.

Vat increase

The party is also requesting that the court declare Section 7(4) of the VAT Act unconstitutional.

This section of the Act allows for a VAT rate change to take immediate effect following Godongwana’s announcement, even before the full budgetary process in Parliament has been concluded.

WATCH Omphile Maotwe speaking about the apartheid tax

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‘Tax the rich’

The EFF has also joined the case as an “intervening party”, opposing the VAT increase and the finance committee decisions to adopt the fiscal framework.

Speaking to the media outside the court, EFF treasurer general Omphile Maotwe said other avenues could be taxed.

“The minister says he’s short of R28 billion on his budget, that’s why he’s increasing the VAT. But that will not give him R28 billion. It will give him R13.5 billion, so he’ll still be short.

“But we are saying to him, actually, you don’t even need that. You need to tax the rich… The problem is not that there are no other avenues. The problem is the minister is scared to touch the rich,” Maotwe said.

‘Apartheid tax’

Maotwe called on the government to introduce an “apartheid tax”.

“There’s apartheid inheritance. Introduce an apartheid tax on everybody who inherited wealth in this country during apartheid, when you know what happened to our people.

“That will give you much more money than the R28 billion that you are looking for. But what is the easy target? The poor,” Maotwe said.

Maotwe stressed the importance of the legal challenge, saying the court was now the only means that stood in the way of a VAT hike coming into effect next week on Thursday.

Court ruling

If the court rules in the DA and EFFs favour, Godongwana will be given two days to reply and the budget’s contents will have to be put forward by the relevant committees.

While Godongwana is not opposing the adoption of the fiscal framework, he is challenging both the interdict and the action against the VAT Act.

In his answering affidavit, the minister asserted that the VAT increase decision “cannot be interdicted at this stage” and argued that the relief being sought is “moot”.

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