By Allison Jeftha for Fin24
Fin24 went shopping at South Africa’s leading retailers to see who has the lowest prices on products exempt from the increase in value-added tax (VAT).
The VAT hike from 14% to 15% came into effect on April 1, after an announcement by former finance minister Malusi Gigaba in the 2018 Budget.
There has been a widespread backlash to the impact it will have on South African consumers’ pockets, especially those of the poor.
Only 19 items have been excluded from the VAT hike.
The current list of VAT-exempt items comprises the following items:
• Brown bread
• Maize meal
• Mealie rice
• Dried mealies
• Dried beans
• Pilchards/sardines in tins
• Milk powder
• Dairy powder blend
• Vegetable oil
• Cultured milk
• Brown wheat meal
• Edible legumes and pulses of leguminous plants
When Fin24 conducted a snap poll among users to share their views on the VAT increase and to tell us which items they would like to be added to the current VAT-free list, we were inundated with responses.
The message was clear: the current list of items is not enough.
Fin24 previously reported that Finance Minister Nhlanhla Nene said government will continue to hold talks with stakeholders in a bid to soften the blow of the VAT hike on the poor, and is prepared to look at expanding the list of zero-rated goods.
Fin24 filled some trolleys at Pick n Pay [JSE:PIK], Woolworths [JSE:WHL], Spar [JSE:SPP], Checkers and Shoprite [JSE:SHP] to get an idea of what the basket of goods would cost.
Here’s what we found:
- Pick n Pay – Total Price: R363.64
- Woolworths – Total price: R592.19
- Spar – Total price: R400.55 spar
- Shoprite – Total price: R331.08
- Checkers – Total price: R403.17
The winner is Shoprite, with Pick n Pay not far behind. To be fair, Fin24 compared house brands, and where there weren’t, we chose the cheapest comparable items.
Where the quantities of comparable items in-store differed, we checked for the prices of the like-for-like items of the respective retailers online. The only two retailers that had different size packaging were Pick n Pay and Woolworths. The comparable sized items were found on their websites.