The Democratic Alliance (DA) and the African National Congress (ANC) are nearing an agreement to pass a contentious budget that includes a proposed 0.5% increase in Value Added Tax (VAT). The two parties, which lead the Government of National Unity (GNU), have been in negotiations to secure a deal that ensures the budget’s approval.
As part of the agreement, the DA will gain more influence over economic policy decisions going forward. However, the Expropriation Act, a key point of contention for the DA, will remain unchanged.
The DA had initially rejected the ANC’s VAT increase proposal, leading to public outcry and concerns among GNU partners. This fueled speculation that the fragile coalition could collapse. However, sources indicate that the parties are now close to finalizing a deal to maintain stability within the GNU.
This development highlights the complexities of coalition governance, where economic and political interests must be carefully balanced. The budget vote is scheduled to take place on Wednesday.