Johannesburg – Legislators in South Africa established plans to underpin health and defense budgets, but also increased value added tax by 0.5%, a measure that will increase the cost of living as consumers pay more for goods, including food and services.
28.9 billion RAND ($ 1.5 billion) for health expenses in the 2025 budget, said Finance Minister Enoch Godongwana, while the country rushes to compensate for compensation were allocated Cortes to help from the United States Under the Trump administration.
The extra money will pay the salaries of approximately 9,300 medical personnel in clinics and hospitals and around 800 newly qualified doctors.
It is expected that health spending in general will grow from 277 billion Rand in 2024/25 to 329 billion Rand in 2027/28.
The increase is produced in the midst of concerns that the South Africa health system, which is concerned about the world’s largest HIV population and has 5.5 million people in antiretroviral drugs that save lives, will tense for the cuts to USAID, the international development agency.
In early February, President Donald Trump canceled PepfarThe president’s emergency plan for AIDS relief, which provides more than $ 400 million annually to HIV programs in South Africa and non -governmental organizations.
Although 74% of the HIV response from South Africa is financed nationwide, some services depend on the financing of the United States government, representing about 17% of the AIDS of the Nation AIDS budget.
Although South Africa is one of the most developed nations in Africa, fighting with high debt rates and slow growth of GDP.
The Ministry of Health will initiate in short consultations on how to divide state funds, including allocations to fill the gaps left by US cuts, said spokesman for the Foster Mohale Ministry.
“It’s too early to tell him how we are going to help those affected by financing,” Mohale said. “But we can communicate (soon) how we are going to use this budget to try to cover some pressure areas.”
The last budget has not yet been approved by the cabinet. The parliamentary committees will discuss the budget in the coming weeks before putting it in the vote before the full legislature. If it happens, the ministries are free to use the assigned funds. However, if Parliament rejects it, new elections are convened and the administration renounces.
About 5 billion Rand ($ 271 million) were contaminated to reinforce military forces, Godongwana said, reaffirming South Africa’s commitment to the maintenance of peace in the region as The fight intensifies in the east of the Congo.
To finance additional expenses in health, education, transport and security, the Government plans to increase the consumption tax, or VAT, at half a percentage point in 2025-2026, generating outrage of political and civic organizations.
VAT is paid for goods and services, including food and electricity.
Another half a percentage point will be introduced in the following year, which puts the VAT rate at 16% by 2026-2027.
“VAT is a tax that affects everyone. When opting for a marginal increase in VAT, its distribution and impact effect were considered with caution, ”said finance minister, trying to defend himself against legislators legislators. “The increase is also the most effective way to avoid more expenses of expenses and allow us to extend social salary.”
