South Africa’s Godongwana Sees No Alternative to VAT Hike (1)

South African Finance Minister Enoch Godongwana sees no alternative to a tax increase at the heart of a budget impasse that is threatening to unravel the country’s governing coalition.

The Democratic Alliance, the second-largest party in the so-called government of national unity after Godongwana’s African National Congress, opposed a 0.5 percentage point hike in the value-added tax rate to 15.5% and has filed a lawsuit to block its implementation.

Enoch Godongwana.

Source: Dwayne Senior/BLOOMBERG

The impasse has worried investors at a time when emerging- market currencies are also under pressure from US President Donald Trump’s trade war.

In court papers filed Wednesday, Godongwana argued ...