The Inkatha Freedom Party (IFP) has stated that, while the VAT increase is a short-term measure, the government must urgently explore alternative revenue sources to ease the burden on South African consumers.
This follows a high-level meeting in Johannesburg on Thursday between the IFP and the African National Congress (ANC), aimed at addressing the ongoing budget deadlock within the Government of National Unity (GNU).
Previously, IOL reported that the IFP was among the political parties that voted in favor of the 0.5% VAT increase and the approval of the 2025 fiscal framework, while parties such as the Democratic Alliance (DA), Economic Freedom Fighters (EFF), and the uMkhonto weSizwe Party (MK Party) opposed it.
Led by IFP President Velenkosini Hlabisa and ANC Secretary-General Fikile Mbalula, the two parties discussed critical fiscal issues, including the revised national budget and the country’s challenging economic conditions.
In a joint statement, both parties reiterated their support for the revised budget presented by the National Treasury and approved by the National Assembly, describing it as “fundamentally pro-poor.” The budget includes measures like the expansion of zero-rated VAT items to protect low-income households.
Regarding concerns over the VAT increase, the parties stressed that it is a temporary intervention.
“The parties agree that the VAT increase is a short-term measure and have called on the National Treasury to urgently explore alternative strategies for generating revenue to alleviate the impact of this marginal increase on consumers,” the statement noted.
Both parties rejected the idea of further government borrowing, citing the current debt levels that limit flexibility. They reaffirmed their commitment to the GNU, acknowledging its importance in maintaining national stability, fostering economic growth, and ensuring long-term development.
The IFP also emphasized its dedication to enhancing cooperation and consensus-building within the GNU. National spokesperson Mkhuleko Hlengwa stated that the party “is committed to strengthening cooperation and consensus-building within the GNU to effectively address national challenges.”
Another key topic discussed was the future of Ithala Bank. Both the ANC and IFP agreed on a bipartisan approach to protect the institution, which plays a crucial role in promoting financial inclusion for historically disadvantaged communities.
The IFP also confirmed it would meet with the DA on April 13 as part of its broader efforts to build national consensus.
Speaking at the commemoration of Chris Hani’s 32nd anniversary, Deputy President Paul Mashatile highlighted the ANC’s decision to reconfigure the alliance to bring more parties into the fold and strengthen the GNU.
“The ANC leadership, following recent events, has decided to reconfigure the alliance. We will bring other parties on board, work with them, and ensure that we engage properly with all parties,” Mashatile said.
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