The Minister of Finance this afternoon released Version 3 of the National Budget Speech. These documents include a document titled ‘Budget Overview 2025’  flagging the main changes, including the amendments to the revenue outlook and tax proposals.
As anticipated, the tax proposals are virtually identical to those included in the March Budget, except for:
- The proposal to implement the 0.5% VAT rate increase in each of May 2025 and April 2026 has been scrapped;
- The list of zero-rated items will not be expanded (as contemplated in March 2025); and
- The fuel levy has been increased for the first time in three years, to replace a portion of the VAT that would have been recovered through the previously proposed VAT rate increase.
Annexure C of the 2025 Budget Review (‘Additional Tax Policy and Administrative Adjustments’) is identical to the version released in March this year.Â
Please refer to our amended Budget Brief for more detail.
Although there is a sliver of good news (preliminary revenue collections for 2024/5 is ZAR 8,9 billion higher than anticipated in the March 2025 Budget Review), the Budget also envisages that next year’s Budget will have to include tax proposals to raise an additional ZAR 20 billion in tax revenue. No indication is provided as to what this could entail.
As this version of the Budget does not include the controversial VAT rate increase which torpedoed the March Budget, there are high hopes that it will be accepted by Parliament, thus bringing an end to the fiscal uncertainty of the last three months.
Our updated visual highlighting the proposed tax changes is available here.Â
