2 April 2025
The Federation of Unions of South Africa (FEDUSA) strongly condemns Parliament’s approval of the 2025 Budget Proposal, which entrenches regressive taxation and austerity measures that will further burden workers and vulnerable communities. The decision to raise VAT to 16% by 2026/27, alongside personal income tax (PIT) bracket creep, will drive up the cost of living while offering no relief to struggling households.
Despite political posturing in the fiscal framework report, FEDUSA rejects any suggestion that the government will reconsider these harmful tax measures. Parliament’s endorsement signals a firm commitment to these policies, with no clear plan to mitigate their disproportionate impact on lower- income South Africans.
The notion that South Africans must continuously pay more while corporate tax enforcement remains weak is unacceptable. FEDUSA has repeatedly called for alternative revenue-generation measures, including a wealth tax and stricter action against illicit financial flows. Instead, the government continues to rely on consumption-based taxes that deepen inequality and economic hardship.
Parliament’s approval of this budget is a betrayal of workers and their families. FEDUSA will not stand by as the government pursues policies that erode living standards and undermine economic stability. We call for urgent and meaningful engagement with social partners to prevent further harm and demand a fiscal framework that prioritises fairness, job creation, and sustainable development.
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