COSATU calls for the scrapping of VAT and PIT hikes in the new Budget

NOW that Parliament has adopted the Budget it must honour its promise to scrap the value-added tax (VAT) and personal income tax (PIT) hikes, what none will doubt the Budget's passing was less than pleasant, and not miss the important gains painstakingly won by Cosatu and other progressive voices, including inside the ANC-led government and Parliament.

- 

The government has heeded opposition from the Federation and others that the proposed 2% VAT hike presented burden that million workingand middle-class families could not afford where they are already battling to cope with the cost-of-living crisis.

Whilst Cosatu has opposed any VAT hike or not adjusted PIT brackets as inflation gives workers already meagre wages, we are pleased Treasury has shifted from its historical default of blockheading criticism of its budgetary proposals and swallow engagement on alternatives.

Cosatu is committed to government and Parliament's variety of revenue and expenditure options that can generate the same or more revenue to rebuild public services and reduce pain on the public without inflicting pain on the working class.

We are pleased government has embraced our call to provide SARS an additional R4 billion to tackle R800bn in outstanding taxes. This we hope will improve tax collection by 1% to 2%, generating an additional R20 to R40bn annually.

In the midst of the parliamentary throw, a key progressive step has been lost sight of. The Minister for Finance has asked for support for government to exit the uncertified Budget cuts that have crippled public services and the economy depend upon.

This is a fundamental shift that needs to be supported if we are to rebuild frontline services and stimulate the growth required to create jobs, whilst providing relief for the poor and unemployed. This is a call Cosatu and the left have made for years.