President Cyril Ramaphosa and finance minister Enoch Godongwana seem hellbent on pushing ahead with a VAT increase despite the rebellion by the ANC’s coalition partners. The two seem to believe that South African taxpayers will allow the government to shove its hands even deeper into their pockets without protest. They are playing with fire.
If we have a VAT hike — even one that is “just 0.75 percentage points” — citizens will revolt.
Within days of the announcement of such a move, Cosatu, the SACP, the MK Party, the DA, the Patriotic Alliance and others will have mobilised their support bases to take to the streets. Ramaphosa will face a revolt worse than the “Zuma must go” protests of the late 2010s.
Ramaphosa, now in his seventh year in power, has failed to show these taxpayers that he has something to give them in return for their support and for their many years of patience as the economy slumped (thanks to his ANC), unemployment spiralled, food became more expensive, crime exploded and institutions weakened.
Any leader who plunged from 57% support to 40% in just five years would do well to reflect on why such a thing happened. Ramaphosa clearly does not think that such reflection is necessary.
The people’s punishment will be harsh.
In June last year President William Ruto of Kenya tried to force through a raft of tax hikes to plug the country’s huge debt. Frustrated young Kenyans, tired of unemployment and corruption, took to TikTok, Instagram and other social media platforms to mobilise against these increases. The intense nationwide protests not only led to the scrapping of the proposed taxes, but Ruto was forced to fire almost his entire cabinet and, humiliatingly, agree to a spate of reforms to combat wasteful expenditure.
He was not the only one. Uganda, Tanzania and Ghana experienced protests around similar issues. Is the ANC watching or listening?
Any leader who plunged from 57% support to 40% in just five years would do well to reflect on why such a thing happened
I keep hearing ANC leaders say a VAT increase will not necessarily harm the poor because Godongwana is planning an extensive basket of zero-rated goods. It shows just how out of touch they are with reality.
The poor are not the problem; it’s the youth. They are suffering economic hardship and unemployment while they watch the corrupt flourish amid widespread financial mismanagement. They are very aware that other, less generously endowed nations are pumping. They are asking: “Why is South Africa, and Africa, so poor?”
The truth, they can see, is corruption encouraged by their leaders. They have had enough of it, which is why young people in Nigeria and Mozambique joined their Kenyan and Ugandan counterparts in protests last year.
The debate about a VAT hike is not just about whether Godongwana can rein in debt, satisfy the World Bank and ratings agencies, and move us along to the medium-term budget statement in late 2025.
The backlash is something far more fundamental. It is about the rampant corruption that has now infected the home affairs department, the health system, the defence force, the police and every part of the civil service you can name. It is about the fact that Ramaphosa and Godongwana do not even begin to talk about firing some of the surplus ministers and deputy ministers they have accommodated in a useless cabinet.
The game is up. People can see this is a government that wants to take and take, and keep on taking, to feed its cronies. They realise that no-one is coming to save them. They will not take it any more.
So, in the next week, as we approach yet another attempt at a budget, we need to be crystal clear about what this means. If there is even a hint of a VAT hike in Godongwana’s speech, then the anger, resentment and discontent that have been brewing for 16 years will explode.
The youthful citizenry will not be protesting a VAT hike. They will not be protesting the fact that their leaders think they can still take money from them through stealth taxes without delivering anything in return. They will be expressing something Ramaphosa and Godongwana should know already: the country is gatvol.
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