This is what a 1% VAT increase looks like

By Isabelle Coetzee

On 1 April, Value Added Tax (VAT) increased from 14% to 15%. In the short term this seems like an insignificant change. But how much will 1% cost you over the next year?

The VAT increase was announced by former finance minister Malusi Gigaba during his budget speech in February.

He explained that this was long overdue and that many countries, including our neighbours Zimbabwe and Namibia, had a higher VAT rate than South Africa.  

He also assured consumers that zero-rated items (refer to image below), which are exempt from VAT, would aid those who can’t afford the increase.

However, VAT does not only affect small food products.

Many large products and services, like financial products and broadband connections, are impacted by the VAT increase.

Have a look at the below infographic to find out how much more you’ll spend on large items over the next year:

VAT increase South Africa Larger sums of money


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