By Hlengiwe Ndlovu | 2018-03-04
CONSUMERS should brace for tougher times as like South Africa, the country’s VAT has been hiked from 14 per cent to 15 per cent.
This increase was announced by Minister of Finance Martin Dlamini in Parliament yesterday in his budget speech.
This rare hike will see commodity prices surging to unexpected heights as this is normally the case when VAT is increased.
South Africa recently hiked VAT by one per cent from 14 to 15 per cent and Swaziland is threading on the neighbours footsteps as if vindicating the adage ‘when South Africa coughs, Swaziland catches the flu’.
The minister of finance also made it clear that the country’s VAT increase was heavily influenced by South Africa, although in the same vein, he alluded to that fact that this was one of several measures introduced to increase the country’s revenue and to ensure the country has diversified revenue sources.
He said: “Increasing the VAT standard rate from 14 per cent to 15 per cent is meant to align with the new rate announced by the Republic of South Africa and to maintain the Sekulula refund arrangement”.
Interviewed after the budget speech, Swaziland Revenue Authority (SRA) Dumsani Masilela described the hike as being rare and inevitable. He said it was inevitable because Swaziland had in the past traditionally been aligned with South Africa where VAT is concerned due to structural issues which make it hard for Swaziland to act unilaterally.
Masilela said that SRA had made extensive consultations on the VAT issue. The Commissioner General, however, said VAT had remained unchanged for a long time though. As if sending a word of comfort to consumers, Masilela said the VAT issue remains subject to debate both in Swaziland, South Africa and other regional platforms.
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