South African Local Government Association Proposes Zero-VAT on Water and Electricity

South Africa’s Local Government Association has proposed the zero-VAT-rating of essential items like water and electricity. SALGA’s Sabelo Gwala says taxing luxury goods will increase government revenue, suggesting a staggered VAT approach. This comes ahead of Finance minister Enoch Godongwana’s revised budget next Wednesday following disagreements over a potential VAT increase. Gwala warns that a blanket VAT hike would have severe consequences: