Earlier this afternoon, Finance Minister Godongwana tabled the much-anticipated 2025\/2026 National Budget Speech (\u2018the budget\u2019). After an unprecedented postponement triggered by widespread disagreement within the Government of National Unity over a proposed 2% VAT hike, the budget contained the following tax-related highlights:<\/p>\n
VAT<\/strong><\/p>\n Noting the difficult policy trade-offs in formulating the budget, the Minister proposed that VAT would increase by 0.5% to 15.5% on 1st<\/sup> May 2025. This would be followed by an additional increase of 0.5% in 2026, with both adjustments expected to expand revenue by approximately R42.5 billion over two years. Cautiously considering the distributional impact and effect of a VAT adjustment, the National Treasury opted for a marginal increase to extend the social wage and prevent additional spending cuts. As VAT is included in the purchase price of new builds sold by developers, a VAT increase slightly raises the overall cost of purchasing such properties.<\/p>\n