VAT panel recommends zero-rating on additional items

schumi

schumi

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VAT panel recommends zero-rating on additional items

CAPE TOWN - The panel on value-added tax (VAT) has submitted its report and recommended that white bread, flour, school uniforms, nappies and sanitary towels should be made zero-rated items, the finance ministry said on Friday.

"The panel further recommends that government should expedite the provision of free sanitary products to the poor and that the zero-rating of school uniforms be done only if they can be separated from general clothing," National Treasury said.

It added that, for each of the recommended items, the panel suggested that the treasury did further investigations to "ensure that the benefits of zero-rating accrue to consumers and are not captured by producers".

The panel was appointed by the finance ministry after VAT was increased from 14 to 15 percent in April, after it was announced in the national budget tabled in February with a view to putting an additional R22.9 billion into the state's coffers in the 2018/19 financial year.
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More at: https://www.iol.co.za/news/south-af...ends-zero-rating-on-additional-items-16495018
 
Producers and resellers will take advantage of this obviously.
 
It also noted that though VAT could not be considered a regressive tax, in reality it cost poorer households a greater percentage of their income than richer households.
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Bummer..
 
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