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Gordhan: We did consider VAT hike

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Finance Minister Pravin Gordhan. (File, AFP)
Finance Minister Pravin Gordhan. (File, AFP)

Cape Town – An increase in value-added tax (VAT) was considered when government was drafting the 2017 Budget Review, said Finance Minister Pravin Gordhan on Thursday.

Speaking at a breakfast show hosted by SABC the morning after he delivered his Budget Speech, Gordhan was asked by a member of the audience why government hadn’t opted for a 1% or 2% hike in VAT.

Gordhan responded by saying that VAT is a “regressive tax”, which has a negative effect on poor people. “It was considered by the Davis Tax Committee, which was tasked with looking at the entire tax administration system in South Africa.

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