Zeroing in on chicken

PROTEIN: VAT RELIEF ON FOOD AN OPPORTUNITY FOR COALITION GOVT

- Amanda Visser

GNU must consider poultry as no VAT item to help the poor.

The proposed expansion of the range of zero-rated value-added tax (VAT) items offers an opportunity for the government of national unity (GNU) to be innovative in its efforts to positively impact the lives of economically struggling taxpayers.

VAT plays an important role in SA, being one of the two largest income-generating taxes for the state at R445 billion for the 202324 tax year. But it is also seen as a regressive tax, affecting the poor harder than the rest.

An analysis for the Davis Tax Committee in 2018 indicated that the poorest 40% of SA households spend roughly a third of their income on food while the richest 10% of households spend only 5%.

Only 19 food items are on the list of VAT zero-rated items. Except for tinned pilchards/sardines, there are no other meat protein sources on the list, says Charles de Wet, executive consultant at ENSafrica.