By Lehlohonolo Lehana.
The Democratic Alliance (DA) future in the government of national unity (GNU) hangs in the balance after it voted against finance minister Enoch Godongwana’s budget on Wednesday, marking the end of tense and heated negotiations with the African National Congress (ANC).
The budget framework was adopted by the National Assembly, a move that secures fiscal stability for the time being.
DA leader John Steenhuisen said his party will file court papers to challenge Parliament’s passing of the 2025/26 Budget.
On Tuesday (1 April), the standing committee shot down proposals to formally amend the budget, which would have forced the matter back to the National Treasury for consideration.
Instead, the ANC and Inkatha Freedom Party (IFP) committee members supported ActionSA’s non-binding “recommendation” to scrap the VAT hike and non-adjustment of tax brackets but not amend the budget.
During the briefing, DA Federal Council chairperson Helen Zille filed papers in the Western Cape High Court to challenge the legality of the Budget process, seeking an interdict to stop South African Revenue Service from implementing the VAT hike on May 1.
“This interdict request is based on our legal challenge to suspend the Fnance Minister’s announcement of the VAT hike and overturning Parliament’s adoption of the Fiscal Framework,” she said.
The party also seeks to suspend the operation of Godongwana’s announcement of the VAT hike based on the constitutionality of the Minister’s power to raise VAT by announcing it in his Budget speech.
“If this is found to be unconstitutional, Minister Godongwana’s announcement on March 12 of the VAT hike would not be binding,” she noted.
She said the party was “absolutely determined” to succeed in its plan to stop the VAT increase on May 1, and believed that it had a strong and solid case.
Zille pointed out that by voting for the Fiscal Framework in Parliament on Wednesday, ActionSA, the Inkatha Freedom Party, and several smaller parties were complicit in hiking VAT for South Africans, which she said would have a “devastating effect” on those already struggling to make ends meet.
“All of those people who are under the mistaken illusion that ActionSA has stopped VAT, are just that deluded. Because in fact the Fiscal Framework as passed by Parliament on Wednesday, that Fiscal Framework includes VAT increase, and the notice put out by Parliament itself says that VAT increase would come in effect on May 1,” she highlighted.
She said the DA had, after weeks of negotiations, put on the table a package of economic reforms that would have enabled the country’s economy to grow and created jobs enabling government to increase its tax package by having far more people employed.
She pointed out that the DA was about to achieve its plan, until the “smaller parties”, which had promised to be the opposition to the ANC and which rejected the Government of National Unity (GNU) when it was set up under “very difficult circumstances,” jumped ship and allowed the ANC to increase VAT without any conditions.
Zille said the DA was not in the GNU for blue lights, cars or ministerial homes or status, but to get South Africa’s economy to grow at the rate it needed, to absorb more people into productive employment and reduce poverty.
She also responded to President Cyril Ramaphosa’s leaked audio in which he said the party has defined itself out of the GNU.
In the seven-minute leaked audio, Ramaphosa can be heard telling party members that the DA placed itself in an “unpleasant position” and that it was now up to the party to find its way out.
The leaked recording was leaked hours before the National Assembly was scheduled to vote on Godongwana’s revised budget.
Meanwhile Ramaphosa’s spokesperson, Vincent Magwenya, said he doesn’t believe Ramaphosa was aware that he was being recorded.
“He was engaged in a political discussion with his colleagues, or comrades as it were, and there was nothing that’s particularly offensive with what he said,” said Magwenya.
Magwenya added that leaking the information doesn’t alter Ramaphosa’s attitude and commitment to keeping the GNU intact with the continued participation of the DA.