A ministerial panel of experts has recommended the expansion of a list of items which should be zero-rated for VAT purposes. The items, which include white bread, white flour and cake flour, sanitary products, nappies and school uniforms, will cost the fiscus an additional R4bn annually, but about 70% of the relief from the ratings will benefit SA’s poorest households. Infant milk formula and frozen chicken parts were also recommended by the panel, which was appointed by Minister of Finance Nhlanhla Nene, but were rejected: at an additional cost of R6bn annually, they would have been a bridge too far for our currently embattled treasury. Items like books, mango atchar, broadband internet access, noodles, yoghurt and VAT on property and rent were also considered for exemption but ultimately rejected.
Comment: Some hard decisions, not taken lightly, and for all the right reasons. Although we have long considered mango atchar a basic human necessity.