In a tough economic time, most South Africans are looking to reign in their spending and cut costs where they can. With the recent takeaways in the mini-budget speech given in October this year, concerns arise at the potential impact these tax increase will have on the poor as the additional three products added to the list of ‘exempt tax food’ are not enough to sustain the lower income family for the entirety of the month.
There was a clear call from South Africans ahead of the 1% VAT increase in April last year, that there needed to be more items added to the tax free food list for them to make it through the month – items such as sanitary towels, meats, and vegetables. And while the government granted them three new Tax-free products there are still major concerns for the financial stability of the lower income households in the country – as it takes more than 19 items, to feed and run a household.
The current list of VAT free products contains a total of 19 items that have not been revised since 1993. The current list looks like…
- Brown bread
- Maize meal
- Mealie rice
- Dried mealies
- Dried beans
- Pilchards/sardines in tins
- Milk powder
- Diary powder blend
- Vegetable oil
- Cultured milk
- Brown wheat meal
- Edible legumes and pulses of leguminous plants
After the mini-budget speech given in October, it was announced that the government had taken the country’s call for more tax-free items with three new additions to the list. Officially adding white flour, cake flour, and sanitary pads to the list. The announcement was made by new Finance Minister Tito Mboweni on Wednesday 24th of October while delivering the medium-term budget policy statement. This comes after a panel of experts was commissioned earlier in the year to investigate whether the state should add any additional items to its basket of goods that are VAT exempt.
Are these additional three items enough? What are your thoughts about the additional items added to the tax-free foods list? Are there items which you believe should be added? Items you wish could be taken away? Leave a comment below on the items you think should be added to the list.
Often we feel like we don’t have control over our finances and spending, especially in a time of tough economic stability within the country, however, here at SaveMoney, we make it our mission to put you back in control of your money, working hard so you and your money don’t have to.