VAT panel to report in June on zero-rated food
Finance Minister Nhlanhla Nene says the panel that has been established to review a list off zero-rated food products will submit its report next month.
The Minister said this when he tabled the Treasury’s Budget Vote at the National Assembly on 22 May 2018.
As part of measures to address a budget shortfall, the National Treasury announced an increase in value-added tax (VAT) from 14% to 15% in February, which took effect in May.
We have established an independent panel of experts to review the list of 19 zero-rated food products and consider how best for government to mitigate the impact of the VAT increase on poor and indigent households.
I have also requested the Panel to consider whether key poverty-alleviating expenditure programmes like the School Nutrition Programme might be better at supporting the vulnerable.
The Panel is expected to submit an initial set of proposals to me by the end of June this year.
Nene said the National Treasury will continue to engage all relevant stakeholders to ensure that the VAT increase will not have an adverse impact on poor and indigent households.
The Minister said, meanwhile, that with tax revenue collections outlook remaining the same, any tax revenue collection agency must, like Caesar’s wife, be above suspicion.
The next major step therefore towards strengthening public finances is to restore public confidence in the SA Revenue Service.
In this regard, President [Cyril] Ramaphosa is finalising the appointment of the Commission of Inquiry into SARS.