The uMkhonto weSizwe Party (MK Party) has tabled a motion of no confidence against South Africa’s Minister of Finance, Enoch Godongwana, following his handling of the Value Added Tax (VAT) matter.
This follows a widespread call for his resignation from the MK Party’s leadership, and that of other political parties.
“Minister Godongwana’s failure to provide clarity and leadership on the VAT issue has sowed confusion in the markets, panic among the poor, small businesses and further entrenched uncertainty in an already fragile economy,” the MK Party said in a statement issued on Saturday.
It further accused Minister Godongwana of ignoring sound advice to implement more prudent economic fiscal interventions for GDP growth and to introduce wealth taxes and levies on luxury goods.
“Instead, the Minister chose the most regressive and anti-poor option of increasing VAT, a measure that disproportionately punishes the working class, the unemployed and the poor majority,” the MK Party added.
It said the Finance Ministry should not be entrusted to an individual, and his GNU deputies, who demonstrate such disregard for progressive fiscal alternatives that should be in place to address the socioeconomic realities of disadvantaged South Africans.
“The Minister’s contradictory public statements, lack of transparency and evident disconnection from the lived experiences of the majority have rendered his continued presence in Cabinet untenable,” the party said.
“South Africa deserves a Finance Minister who prioritises the interests of the people over those of capital interests,” it concluded.
As reported on Thursday, Finance Minister Enoch Godongwana scrapped the 0.5% Value Added Tax (VAT) hike that was set to kick in on May 1.
This means VAT will remain at 15%.
However, by not increasing VAT, the estimated revenue will fall short by around R75 billion over the medium-term.
Later on Thursday, the African National Congress (ANC) hit back at political parties claiming “victory” over VAT reversal, stating that the decision was not made under pressure but by Parliament itself.
“This outcome did not arise from experience, nor as a concession to pressure or coercion, but from a shared commitment across party lines that the working class, the poor, and all other people cannot be further burdened in this economic climate,” ANC spokesperson Mahlengi Bhengu-Motsiri said.
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