Wednesday 12 March 2025 – Finance Minister Enoch Godongwana’s Budget speech has confirmed South Africans’ worst fears: a 0.5 percentage point VAT increase and another round of above-inflation excise tax hikes that will make life even harder for honest citizens while handing yet another victory to criminals.
Tax Justice SA (TJSA) condemns these measures as ill-judged, unjust and counterproductive. Instead of tackling the rampant illicit trade that is already robbing the fiscus of R100 billion every year, the government has chosen to punish law-abiding businesses and consumers, driving even more economic activity into the hands of criminals.
“Minister Godongwana has ignored reality and chosen a path that will only worsen South Africa’s economic crisis,” says TJSA founder Yusuf Abramjee. “Increasing VAT and ‘sin taxes’ will not raise the revenue government hopes for – it will only boost illicit traders who operate with impunity while honest businesses struggle to survive.
“The Budget fails to address the real problem: criminals who are looting the nation on an industrial scale in virtually every sector. Why is the government so quick to squeeze honest taxpayers but so slow to shut down the kingpins of illicit trade? Since the ‘Gold Mafia’ exposé in 2023, not a single arrest has been made in South Africa.”
TJSA urges the government to prioritise enforcement over tax hikes. SARS and the National Prosecuting Authority (NPA) must be properly resourced and empowered to take decisive action against illicit trade. Until then, raising taxes will only drive more consumers into the black market, further eroding the country’s revenue base.
“The government should be locking up criminals, not making life harder for the honest South Africans who keep this country running,” Abramjee concludes. “This Budget is a gift to crooks and a slap in the face to law-abiding citizens. Tax justice must come before tax hikes.”
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