Finance Minister Enoch Godongwana is set to return to Parliament this afternoon to deliver what is now being called Budget Speech 3.0 — his third attempt at tabling South Africa’s Fiscal Policy Framework for 2025.
This year’s budget speech is not just about government income and spending; it’s seen as a critical test of the country’s political and financial stability.
Godongwana is under pressure after he recently withdrew a 0.5% increase in Value Added Tax (VAT), which was initially announced in his March budget speech.
The decision came after strong opposition from political parties such as the Democratic Alliance (DA) and the Economic Freedom Fighters (EFF), who challenged the legality and fairness of the VAT hike in court.
The reversal now leaves a large gap — R75 billion — in the budget, which the Minister must now find a way to address.
What to expect from Budget Speech 3.0
The Minister is expected to present a revised plan that explains how government will manage its spending without the extra income the VAT increase would have brought in.
This comes at a time when South Africa’s unemployment rate is at 32.9%, with young people the hardest hit. Many are looking for a budget that focuses on creating jobs, boosting economic growth, and protecting essential services like health and education.
National Treasury has already confirmed that there will be no new tax increases in this speech, but the challenge remains: how to plug the R75 billion gap without borrowing more money or cutting too many public services.
This means today’s speech could include cuts to government spending, delays in funding certain projects, or increased efforts to collect more tax revenue through other means.
The court case over the VAT hike is still ongoing. The DA wants the court to rule that any tax increase must be debated and approved by Parliament before it is announced. For now, the VAT will remain at 15%, and South Africans will not see the price of everyday goods go up because of this tax.
Watch Budget Speech 3.0 live stream right here
Minister Godongwana is scheduled to speak at 14:00 today, and the address will be broadcast live and uninterrupted.
The outcome of today’s speech could shape South Africa’s economic direction for the coming year, especially as the government looks for ways to support struggling citizens and businesses while keeping public finances stable.