South Africa’s “VAT desert storm” may have ended, at least for now, after witnessing political theatrics and policy paralysis, that attempted to bring snow to a desert while bidding to solve the dry revenue generation period.
It almost displayed itself through a public gallery with all the makings of a political thriller—multiple plot twists, frantic coalition bartering, and a final “U-turn of the century”—yet the real victims, township businesses and family-run businesses, are left wondering if it is going to rain cats and dogs or bring clear blue skies for VAT season.
While the ANC, DA and EFF spar over “fiscal sustainability” versus “taxing the rich,” township spaza shops, clothing retailers and small cafés were caught in the crossfire.
When President Cyril Ramaphosa attempted to patch his dripping VAT shack, suddenly, the Cape wind blowing from the DA’s finance spokesperson Dr. Mark Burke, blasted the VAT proposal as an outdated ideology that has long sunk its head under Soviet beach sand. I trust that you will be able to connect the dots between ANC and Soviet beaches, if not, ask the zero pusillanimous “Mbaks.”
The EFF’s Julius Malema, for his RED part, wanted nothing but “kill the rich, spare the poor” demanding an increased tax on wealthy people who can afford to buy few buffalos without breaking a couch.
Behind the not-so-closed doors, coalition talks teetered on collapse, with the DA taking its Government of National Unity (GNU) to court, only to later reconcile out of court. And just like that, every political butterfly came out of the cocoon proclaiming a colourful victory for taxpayers.
Yet, throughout this VAT expropriation spectacle, the real refugees were not the forty-nine (49) Afrikaaners, but rather South African small businesses, caught in the political pickpocketing without compensation.
Some small companies spent weeks and vast sums of money updating their accounting software—only to end up starring in the ultimate “behind-the-scenes” blooper reel of tax season.
Even Uncle SARS—the tax collector small businesses love to vilify—finally grudgingly admitted that its VAT flip-flop has real-world fallout for vendors.
The Commissioner conceded that SMMEs sank significant resources to cater for a rate hike that tried a moonwalk on the floor full of political potholes, as a result of an ambiguous parliamentary ping-pong VAT policy.
Although SARS promises to make VAT ride less bumpy, for many township traders and family-run businesses, the bigger question remains: who will foot the bill for this tax-led whiplash?
The naked truth is: the storm hasn’t fully passed—there’s still thunder rolling in the distance.
The Finance Minister, Enoch Godongwana, is gearing up to re-table the 2025 National Budget on 21 May, for the third time this year and small businesses are bracing for yet another policy adventurous stint on planet Uranus.
Budget 3.0 might promise fresh forecasts, potential spending cuts, and no mention of the ghost VAT hike, but the crystal ball warns SMMEs to hold tight, as a single day in the South African political dynasty is dangerously long.
It has an inherent tendency to catch people flying by the seat of their pants, like Comrade Rasool’s sudden departure from the now-famous refugee camp.
While big corporates may survive a little fiscal drama, SMMEs are left asking if more belt-tightening, new levies, or actual relief is on the horizon.
As the dust settles on South Africa’s VAT Dakar Rally, the true survivors—township tuck shops, small businesses, and emerging agro-processors are those that have weathered the U-turns, re-priced their goods, and navigated SARS’ labyrinthine communications with grit and resilience.
The endurance of these businesses through political brinkmanship reveals a hard truth: each VAT debate risks becoming a road spike, not a revenue booster.
As policymakers prepare for Budget 3.0, they must remember that SMMEs are not just line items, they’re the backbone of job creation and community stability.
True survivors will be those spared from policy ping-pong, supported instead by clear and consistent VAT frameworks that empower rather than penalise the very businesses we rely on to drive South Africa’s economic revival.
Bongani Ntombela, executive: programmes at 22 On Sloane.
BUSINESS REPORT
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