Subsequently, the EFF filed an application to be allowed as the second applicant.
It further asked the court to suspend the Standing Committee on Finance's fiscal framework report and both Houses of Parliament's adoption of the report, pending Part B's finalisation. While the DA's prayer in this case is temporary, the EFF's is permanent.
The EFF also asks the court to interdict the implementation of the fiscal framework, including the 0.5 percentage point VAT increase.
Much of the DA's case was an attack on the finance minister's power under the VAT Act to declare a VAT increase instead of Parliament as the representatives of the people.
Advocate Michael Bishop, for the DA, said their case was not about the substantive merits of the VAT increase but about who decides to increase VAT.
"VAT can only be increased when Parliament does it after a lawful process. That is our case," said Bishop.
He said there was a theme in Godongwana's responding affidavit that only the minister and Treasury were competent to make fiscal decisions.
Bishop argued that a VAT increase was not a decision for the finance minister or National Treasury to make.
"It is a decision for Parliament to make."
He said the minister and Treasury had a role, but it was a proposing role. The decision-making role was with Parliament, he said.
He cited Constitutional Court rulings to support his arguments that the executive could not increase tax without Parliament.
Mabindla-Boqwana asked Bishop why there was such an elaborate parliamentary process if the VAT increase would go ahead on 1 May.
Bishop said that was why the DA argued that the VAT Act provision that gives the finance minister the power to increase VAT was unconstitutional.
In response, Godongwana's counsel, advocate Mahlape Sello, argued that the Constitution did not recognise an absolute separation of powers and that the VAT Act's provision allowing the minister to increase the VAT rate was not unconstitutional.
Sello faced a barrage of questions from the Bench – including from La Grange, who at one time asked: "What is the point you are trying to make?"
La Grange asked how it could be allowed in South Africa's democracy for the executive to dominate the legislature in this instance. Sello said she didn't think the executive was dominating.
She said the Constitution allowed the executive to speedily resolve an emergency, while a parliamentary process was, by its nature, not speedy.
Mabindla-Boqwana said Bishop had argued that it was not an emergency.
Sello said it depended on how one defined "emergency". She said it became an emergency because of the prospect of a budget deficit.
La Grange said South African Revenue Service commissioner Edward Kieswetter said there were other ways to raise revenue besides the VAT increase and that there was no need for a VAT increase.
Sello said it was in the "realm of preferable choices" and that the minister's decision was not open to challenge purely because there were other options.
Savage asked what kind of power the minister had to adjust the VAT rate.
Sello said it was a "designated power to raise revenue".
Savage asked:
So how can this happen when the Constitutional Court has been quite clear that that may not happen?
Sello didn't provide a clear answer except to refer to another ruling.
Remarked Savage: "The notion of no taxation without representation seems to be a vague concept in the mind of the minister."
Taxation without representation generally refers to a process where taxes are imposed on citizens without the consent of their representatives in Parliament.
Savage said it seemed Parliamentary processes had been put aside.
Sello argued that the Constitution allowed the minister to make the necessary adjustments because of the "speed required".
"I think we've seen in the world the dangers posed by executive creep, with executive orders made not tethered to the Constitution," said Savage.
"But this one is," responded Sello.
After further probing from the Bench, Sello had to concede there was no ruling supporting her arguments.
"What I find interesting from the minister's perspective is that this imposition of a higher tax rate of VAT has national significance. And particular significance to the poor," said Savage.
Sello responded: "I would like to place it on record that the potential impact this would have on the poor is not lost on the minister of finance."
La Grange again asked why the minister was "adamant" about raising VAT when Kieswetter believed there were other ways to increase that revenue.
"There might be other avenues, but it's a question of the availability and immediacy to address the deficit," responded Sello.
Savage's remark related to the arguments of advocate Tembeka Ngcukaitobi, for the EFF, that the VAT increase was unconstitutional as it didn't comply with the Bill of Rights in that it would increase South Africa's already exorbitant inequality.
Ngcukaitobi also argued that Godongwana and Parliament were deceitful in creating the impression the VAT increase could be reversed. Sello vehemently denied this but did little to persuade Ngcukaitobi.
Both parties also alleged several procedural irregularities with the finance committee's adoption of its report on the fiscal framework, which advocate Karrisha Pillay, on behalf of Parliament, countered by arguing there was nothing to suggest that Parliament's rules were not followed.
Mabindla-Boqwana said it was a complex matter that must be decided soon. She said they would hand down judgment by 29 April at the latest.
