The reason for the abrupt cancellation was the failure of the minister to get cabinet approval for the proposal to raise value added tax (VAT) from 15% to 17%. VAT is the second biggest contributor to tax collection after personal income tax, followed by corporate taxes.

For the time being, South Africans can breathe a little easier, as the 2% increase would have a short-term negative impact, particularly because VAT applies to most goods and services, raising their costs and putting additional strain on consumers' wallets, he adds.

South Africa's Finance Minister Enoch Godongwana has been forced to postpone the unveiling of the national budget following sharp disagreements within the coalition government.

The important question in a democratic setting is who gets to pay taxes and how they connect to the well-being of its citizens.

South Africa’s Democratic Alliance (DA) party said the 2025 budget was postponed on Wednesday due to its opposition to a 2-percentage-point increase in value-added tax (VAT) proposed by the African National Congress (ANC).

South African Finance Minister Enoch Godongwana presented highlights of his upcoming budget to colleagues two weeks ago, but skipped a crucial detail to stop it from leaking — triggering a major fallout in the nation’s coalition government.

Officials say pro-business Democratic Alliance and senior figures in African National Congress objected to VAT rise