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Govt to overhaul VAT System by end of year - Finance Minister

New VAT-free foods: Most canned veg still excluded, but oxtail, tongue may be in

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Most canned vegetables will not be included in the list of zero-rated food products, according to new VAT legislation proposed by Finance Minister Enoch Godongwana, in contrast to comments made in his budget speech this year.
The South African Revenue Service (SARS) has announced that from April 1, 2025, certain foods will be exempt from Value Added Tax (VAT) to help alleviate the cost of living for low-income households. However, the list of VAT-exempt foods does not include most canned vegetables, which has sparked some controversy. Notably, items like brown bread, rice, and lentils are included in the exemption, but surprisingly, luxury items like oxtail and tongue might also qualify for the VAT exemption. This decision has led to debates about the criteria used for selecting which foods qualify for the exemption, with critics arguing that the inclusion of such expensive meats undermines the initiative's aim to support the economically disadvantaged. The exemption list aims to cover staple foods that are essential for basic nutrition, but the exclusion of common canned vegetables has raised concerns about the policy's effectiveness in addressing food affordability for the poorest segments of the population.

Read the Full News24 Article at:
[ https://www.news24.com/fin24/economy/new-vat-free-foods-most-canned-veg-still-excluded-but-oxtail-tongue-may-be-in-20250314 ]