Concerns over 2018 Budget

2018-03-13 06:01
Pensioner Clementine Shozi said she cannot afford any increases in VAT and other essentials on a Sassapension.PHOTO:Phindile Shozi

Pensioner Clementine Shozi said she cannot afford any increases in VAT and other essentials on a Sassapension.PHOTO:Phindile Shozi

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IN the midst of the increases announced during the Budget Speech last week, social-grant beneficiaries are to see a slight increase in the amount they receive from the government. However, there will also be a one-percent increase in VAT.

According to the speech by then Finance minister Malusi Gigaba, the government has taken deliberate steps to adjust social-grant values above inflation to at least partially cover the increase in VAT.

Fever spoke to the community to find out their views on the increases.

Pensioner Clementine Shozi (86), whose grandchildren live with her, said she’s not excited about the increase of VAT because it is day-light robbery.

She said this will be a strain on her as she has to pay for everything with her pension money. “I have to pay for my apartment, bills, groceries and also look after my grandchildren,” said Shozi.

She said that living on a Sassa pension is extremely difficult. “Will the money given to us be enough for all our needs now that the tax has increased?”

She said she will not be able to live on maize meal and brown bread for the rest of the year. “The increase on the VAT will affect us all and that means all these food essentials will also increase so when he said, ‘if we increase the price then it will negatively affect the poor’, he was just fooling us.”

She said that by increasing VAT, everything will automatically increase. “I just feel like he was playing us by trying to appeal to the less-privileged. And by quoting Kendrick Lamar, he was trying to get the younger generations’ attention,” she said.

Kwanda Phungula, who is a petrol attendant at a Hillcrest garage, said the minister could have explored other options like taxing business income more, to obtain the much-needed money.

“An increase in VAT affects everyone, including the poor and middle-class people.”

He said the VAT increase will not just affect the poor as essential foods won’t increase but what about water, electricity, petrol and other grocery items?” asked Phungula.

He agreed with Shozi that no one can live on brown bread for the rest of the year. “This one-percent addition to VAT is going to kill us all, especially the pensioners,” he said.

In his speech, Gigaba said that pensioners previously received R1 600 but will now receive R1 690 by April 1 and another R10 by October 1.

Gigaba said that an additional R2,6 billion has been added to social grants since the medium-term budget policy statement, to enable these changes.

Grant recipients currently receive the following:

• old-age grant payment of R1 600 for pensioners over the age of 60, and R1 620 for those over 75;

• disability and care dependency grants of R1 600 a month;

• foster-care grants of R920 a month; and

• the child-support grant of R380 a month.

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