VAT-FREE: WHO IS THE CHEAPEST?
FIN24 went shopping at South Africa’s leading retailers to see which has the lowest prices on products exempt from the value-added tax.
The VAT hike from 14% to 15% came into effect on April 1, after an announcement by former Finance minister Malusi Gigaba in the 2018 Budget.
There has been a widespread backlash to the impact it will have on South African consumers’ pockets, especially those of the poor.
Only 19 items are excluded from the VAT hike.
The list of VAT-exempt items comprises: brown bread, maize meal, samp, mealie rice, dried mealies, dried beans, lentils, pilchards or sardines in tins, milk powder, diary powder blend, rice, vegetables, fruit, vegetable oil, milk, cultured milk, brown wheat meal, eggs, edible legumes and pulses of leguminous plants.
When Fin24 conducted a snap poll among consumers to hear their views on the VAT increase and which items they would like to see added to the VAT-free list, we were inundated with responses.
The message was clear — the list of items is not enough.
Finance Minister Nhlanhla Nene said the government will hold talks with stakeholders in a bid to soften the blow of the VAT hike on the poor.
Nene also said that the government is prepared to look at expanding the list of zero-rated goods.
Fin24 filled some shopping trolleys at Pick n Pay, Woolworths, Spar, Checkers and Shoprite to get an idea of what a list of VAT-free goods would cost at the different retailers.
Shoprite emerged the winner.
Here’s what we found: Shoprite — R346,61
Pick n Pay — R363,64 Spar — R400,55 Checkers — R403,17 Woolworths — R592,19