By Thivanni Naidoo
In the midst of President Cyril Ramaphosa visit to the United States of America on official business to negotiate and mend ties with President Donald Trump, finance minister Enoch Godongwana will take centre stage in presenting the country’s new budget. He postponed it the first time, he was being taken to court the second time and then scrapped it and he tries yet again!
It’s something unheard of in South Africa and it also shows how fractured the unity government or the government of national unity could be, but unity governments exist all over the world and it’s never easy to please everyone withing the forced working relationship.
With a failed tabling of the budget twice this year already, many are holding their breath before today’s attempt. The first failed attempt back in February the 19th of this year, had the speech cancelled minutes before its scheduled time due to the Government of National Unity (GNU) disagreement over the proposed Value-Added Tax (VAT) increase from 15% to 17%.
The second attempt on the 12th of March, had Finance Minister Enoch Godongwana presenting a revised budget with a proposed 0.5% increase in VAT this year (2025) and then a further 0.5% in 2026 which will eventually have the VAT percent sitting at 16% by next year. The Democratic Alliance (DA), a coalition party of the GNU, opposed the proposal. Having taken the case to the Western Cape High Court, the proposed VAT increase was then suspended days before the start date of 1st of May.
Today’s budget speech will see a proposal from Godongwana about a R75 billion revenue shortfall which was caused by the previous reversal of SA’s VAT increases in the last two budget speech attempts.
Much pressure is now on the Minister of Finance as many South Africans wait with bated breaths for the outcome of the pending proposal and financial choices that will decide the future for the rest of 2025 and next year as well as a way to decide a way of solving SA’s debt.
