| Update: | Compliance Alert – VAT rate increase has been reversed |
| Date: | 2025-05-05 |
Recently, it was announced that the VAT rate would progressively increase from 15% to 16%. The VAT increase was going to become effective on the following dates:
- May 1, 2025: 0.5% increase to 15.5%;
- April 1, 2026: 0.5% increase to 16%.
However, this decision was overturned by the South African Minister of Finance on April 24, 2025, at midnight. It was announced via media statement that the VAT rate increase would not come into effect, making the VAT rate remain at 15% from May 1, 2025.
Due to the late announcement, it is expected that some businesses may have been affected. Companies must track all invoices issued or received with a 15.5% VAT rate and take appropriate measurements.