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  • Grassroots organisations act in their own names and are accompanied in their own advocacy and development.
  • The work of livelihoods groups has improved food security as a result of their food production and micro enterprises.
  • Our work and our practice seek to enhance human dignity.

The VAT hike on food prices and calls for food price regulation.

On the 1st of April 2018, despite massive resistance, government went ahead and increased the VAT rate to 15%. We have argued in the past that increasing the VAT rate on food was unwise.
This media statement using our April 2018 data looks at the month-on-month impact of the VAT hike for households living on low incomes. It is a snap shot as the effect of the VAT hike will take time to run through the value chains however already it signals some worrying trends. Foods subject to VAT make up 54% of the total cost of the PACSA Food Basket. The statement finds that the increase in VAT by 1% resulted in a 6.5% increase in the total VAT levied on the foods subject to VAT on the PACSA Food Basket, moving the total VAT payable to R221.59.
The PACSA Food Basket has now reached its highest level of R3 144.02. It has increased by 9% over the past eight months. Hiking the VAT rate has made the affordability crisis deeper and will have a considerable negative impact on households living on low incomes, who are already in a very severe crisis.
We call for food to be made a public good; to remove all VAT from food; to increase wages to those of a living wage and to regulate food prices.
April 2018 PACSA monthly food price barometer

Resource paper on the proposed VAT and fuel levy hike and its impact for the foods on our plates.

Budget 2018 proposed hiking the VAT rate to 15% and levying a 52 cents hike on the fuel levy. Using food as an entry point and drawing on PACSA’s food price barometer research, the following short paper is intended as a resource to better understand and conceptualise the impact of these proposals for working class households. Read full paper

PACSA - AGEH International Consultation on Re-thinking development practice as global solidarity

Mervyn Abrahams PACSA and Michael Steeb AGEH welcome participants to the consultation
 
26 participants from 12 countries gathered for a 4 day consultation hosted by PACSA and AGEH, a German Association for Development Cooperation, in Paarl, outside Cape Town, to re-think development as liberation and to promote an alliance of international faith based and Church related organizations promoting exchange of volunteers as an expression of human solidarity.

PACSA submission on the proposed National Minimum Wage

We call on the Portfolio Committee on Labour to consider the political consequences of passing a poverty-level National Minimum Wage which with the possible amendments to the Labour Relations Act and Basic Conditions of Employment Act will be felt for generations. These will lock Black South African workers and their families into deeper poverty and reproduce the low growth, low wage and low jobs trajectory. Read the full submission

PACSA letter to the Standing Committee on Finance on expanding the zero-rated basket to mitigate the effect of VAT

Expanding the basket of zero-rated foods has been contested on the basis of the following arguments:
  • Expanding the basket may disproportionately benefit the rich (because rich or poor we share quite a few common foods).
  • Selecting the new foods to be included in the zero-rated basket is incredibly complex as what foods are eaten, how foods are prepared and changing households purchasing patterns are all influenced by household specific and other complicated external variables. Even with the experience PACSA has around tracking food patterns and prices, there are just far too many variables in creating an expanded zero-rated basket that responds to the requirements of the working class and the impact on the larger economy. At best, we would be able to make an educated guess – but this hardly seems a sufficient response to the crisis we are in. Read full statement

About PACSA

PACSA is an independent, faith-based, non-governmental organisation that has worked to achieve social and economic justice for over 30 years. PACSA works for improved social cohesion as inequality and poverty is reduced in communities in the uMgungundlovu District in KwaZulu Natal, South Africa.

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