Draft Bill Has VAT Hikes

BUDGET: BINDING LEGISLATION DESPITE DA'S URGENT COURT APPLICATION

- Amanda Visser

National Treasury went ahead and introduced the Rates and Monetary Amounts and Amendment of Revenue Laws Bill on Friday by notice in the Government Gazette.

The draft Bill, as published on 12 March, provides for the highly disputed value-added tax (VAT) increase, the expansion of the list of zero-rated items, increases in sin taxes, and adjustments to tax brackets.

This is despite the DA's urgent application to the Western Cape High Court in Cape Town to declare the section in the Act, allowing the minister of finance to make binding legislation through a budget announcement, unconstitutional.

The party is asking the court to suspend the increases pending the final determination of the constitutional challenge. Section 7(4) of the act deals with the variation of the VAT rate.