PARLIAMENT - Value-added tax (VAT) on white bread flour, white cake flour and sanitary pads will be zero-rated from April 1 next year, Finance Minister Tito Mboweni announced on Wednesday.
"The revenue loss associated with zero-rating these items is estimated at R1.2 billion. However, zero-rating these products targets low-income households and restores the dignity of our people," Mboweni said while tabling the medium-term budget policy statement in Parliament.
The minister's announcement followed work done by a panel of experts, appointed by Mboweni's predecessor, who were tasked with making recommendations to National Treasury on whether the list of zero-rated items should be expanded.
The panel, in a report released in August, recommended that South Africans be exempt from paying VAT on white bread, white bread flour, cake flour, sanitary products, nappies and school uniforms.
The panel was appointed after VAT was increased by one percent to 15 percent in April this year.