South Africans could soon see relief in their grocery bills as the National Treasury has put forward a fresh proposal to expand the list of VAT-free food items in the 2025 Budget. The move comes in response to growing concerns about rising food prices and their impact on low-income households.
Treasury officials confirmed that consultations are underway with various stakeholders, including consumer rights groups, nutrition experts, and industry leaders, to review which essential food items should be exempted from the standard 15% Value-Added Tax (VAT). The goal is to help ease the burden on poor and working-class citizens amid continued economic strain.
A Long-Awaited Move Toward Food Affordability
The last major adjustment to the VAT-free list was in 2018 when white bread flour, cake flour, and sanitary products were added following public submissions. Since then, inflation and global food supply issues have worsened, making basic nutrition increasingly unaffordable for many South African families.
Finance Minister Enoch Godongwana hinted in a recent media briefing that the 2025 budget might prioritise food security, stating, “We are exploring the expansion of zero-rated food items to include more nutritious and widely consumed staples.”
Among the items under review are:
- Frozen vegetables
- Tinned pilchards
- Peanut butter
- Dried beans (additional varieties)
- Brown rice
- Baby food
These items are seen as both affordable and nutritionally dense, making them strong candidates for VAT exemption.
Rising Food Costs: A Persistent Concern
Recent statistics from Stats SA show that food inflation remains a critical issue, with year-on-year prices of meat, dairy, and vegetables seeing noticeable hikes. For families earning below the poverty line, every cent counts — and VAT on essential goods can significantly affect their ability to meet daily needs.
Civil society organisations have long campaigned for more inclusive tax relief on groceries. Groups like Black Sash and the Pietermaritzburg Economic Justice and Dignity Group have argued that the current VAT-free basket, while helpful, does not fully reflect the eating patterns or nutritional needs of the majority.
Experts Call for Nutritional Focus
Health and nutrition experts have welcomed the Treasury’s initiative but urge that decisions be informed by science. Dietician Thandi Mokoena explained, “It’s not just about price — it’s about promoting access to food that supports healthy development. VAT exemptions should prioritise protein, fiber, and iron-rich items, especially for children and women.”
There are also calls to ensure that any newly added VAT-free items are culturally appropriate and commonly consumed by lower-income groups.
Treasury to Open Public Feedback Window
The Treasury plans to open a public comment period in the coming weeks, where South Africans can voice their opinions on which food items should be added to the zero-rated list. This participatory approach is expected to encourage transparency and inclusivity in finalising the VAT changes before the 2025 budget presentation.
The proposal is expected to be formally tabled in February 2025 during the national budget speech. If approved, the changes could come into effect by mid-year, giving consumers something to look forward to amid ongoing cost-of-living pressures.
Also, read: South Africa’s Food Prices Continue to Climb — Here’s the Hardest-Hit Items
Looking Ahead
While VAT-free food items won’t solve South Africa’s food security crisis alone, the move signals a positive step toward more equitable economic policy. As the nation continues to grapple with unemployment, high inflation, and poverty, targeted tax relief on essentials could offer some much-needed breathing space for vulnerable communities.
For now, all eyes are on the Treasury as South Africans await further details — and hopefully, a lighter bill at the till.
