Johannesburg – South African legislators have established plans to strengthen health and defense budgets, but have also set up a value added by 0.5%, a decision that will increase the cost of living because consumers pay more for goods, including food and services.
28.9 billion additional rands ($ 1.5 billion) were reserved for health spending in the 2025 budget, said finance minister Enoch Godongwana Cup to help in the United States under the Trump administration.
Additional money will pay wages of approximately 9,300 medical staff in clinics and hospitals and around 800 newly qualified doctors.
Health spending should go from 277 billion rands in 2024/25 to 329 billion rands in 2027/28.
The increase comes in the midst of concerns that the health system of South Africa, which deals with the largest HIV population in the world and has 5.5 million people on vital antiretroviral drugs, will be stretched by Cups in USAID, the American agency for international development.
In early February, president Donald Trump canceled PepfarThe president’s emergency plan for the relief of AIDS, which provides more than $ 400 million a year to HIV programs in South Africa and non -governmental organizations.
Although 74% of the response to HIV in South Africa is funded at the national level, some services depend on the financing of the US government, which represents around 17% of the AIDS nation’s response budget.
Although South Africa is one of the most developed nations in Africa, it fights with high debt rates and slow GDP growth.
The Ministry of Health will start the consultations on how to divide the state funds, including allowances to fill the gaps left by the US cups, said the ministry spokesman Foster Mohale.
“It is too early to tell you how we are going to help people affected by the financing freezing,” said Mohale. “But we will be able to communicate (soon) how we will use this budget to try to cover certain pressure zones.”
The last budget has not yet been approved by the firm. The parliamentary committees will debate the budget in the coming weeks before voting it before the legislature. If it passes, the ministries are free to use the funds as allocated. However, if Parliament rejects it, new elections are summoned and the administration resigns.
Some 5 billion rands ($ 271 million) have been infiltrated to strengthen military forces, said Godongwana, reaffirming South Africa’s commitment to peacekeeping in the region as The fight against intensification in the east of the Congo.
To finance additional health, education, transport and security expenditure, the government plans to increase the consumption tax, or VAT, from half a point in percentage in 2025-2026, aroused the indignation of political and civic organizations.
VAT is payable on goods and services, including food and electricity.
Another percentage half-point will be introduced the following year, placing the VAT rate at 16% by 2026-2027.
“VAT is a tax that affects everyone. By opting for a marginal increase in VAT, its distribution effect and its impact have been cautiously taken into account, “said the Minister of Finance, trying to repel the air of the legislators. “The increase is also the most effective way to avoid new discounts of expenditure and allow us to extend social salary.”