Treasury scrambles to reverse VAT increase

The clock is ticking for the Treasury to determine whether re-tabling the national budget could serve as a potential solution to avert a recently scrapped VAT hike set to take effect next week.

- By Setumo Stone

Despite the Treasury's abrupt U-turn on Thursday - announcing the 0.5% VAT increase, originally slated for May 1, had been scrapped - the hike remains legally binding. This is because parliament already approved the fiscal framework containing the tax adjustment on April 2.

To formalise the reversal, the Treasury must now navigate urgent legislative processes in the coming days, raising questions about the feasibility of undoing the decision before the deadline. The missing piece is where Treasury, which gazetted the law, sits on this issue, so they should guide Parliament.