Godongwana Defends VAT Hike, Dismisses Opposition’s Legal Challenge as “Without Merit”

Finance Minister Enoch Godongwana has pushed back against a legal bid by opposition parties to block South Africa’s controversial VAT increase, filing a robust affidavit that brands their court challenge as legally unfounded and procedurally flawed. The Democratic Alliance (DA) and Economic Freedom Fighters (EFF) launched urgent High Court proceedings this week seeking to invalidate Parliament’s adoption of the 2025 fiscal framework, which includes raising VAT from 15% to 16%.

In his sworn response, Godongwana argued that the opposition’s case fails to meet the threshold for urgent judicial intervention. “The applicants have not demonstrated irreparable harm warranting this court’s interference,” he stated, noting that the DA retains parliamentary mechanisms to contest the policy. The minister emphasized that tax policy falls squarely within executive and legislative authority, provided constitutional processes are followed.

The opposition maintains that the regressive tax will disproportionately burden low-income households, with EFF leader Julius Malema calling it “an attack on the poor.” Civil society groups and trade unions have echoed these concerns, warning that the hike could deepen inequality amid stagnant wages and rising living costs.

However, Godongwana framed the adjustment as fiscally unavoidable, citing a R56 billion revenue shortfall that threatens social grants, infrastructure projects, and debt stabilization efforts. “Without this measure, we risk catastrophic service delivery failures,” his affidavit reads.

Legal experts suggest the case could set important precedents regarding parliamentary oversight of tax policy. “This isn’t just about VAT—it’s testing the boundaries between fiscal policy and judicial review,” said constitutional law professor Richard Calland.

The Western Cape High Court will hear arguments next week, with its decision determining whether the hike proceeds during litigation. The outcome carries significant political stakes for both an embattled ANC government seeking fiscal stability and opposition parties positioning themselves as defenders of economic justice ahead of 2026 elections.

As the legal battle unfolds, economists warn that prolonged uncertainty could spook markets already wary of South Africa’s deteriorating public finances. The rand weakened slightly following news of the court challenge, reflecting investor jitters over potential policy paralysis.