Municipalities to dip into R400bn VAT kitty in radical financing proposals

Sowetan · 🇿🇦 public South Africa · May 08, 2026 · 105 words · By Thando Maeko

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What to know about Municipalities to dip into R400bn VAT kitty in radical financing proposals

The government seeks to redirect a slice of VAT revenue to local government by giving municipalities a share of the more than R400bn South African Revenue Service (Sars) collects in VAT annually.

Claims checked 6

Techniques found 0

Topics 0

Coverage spectrum

Coverage gap: Low Left coverage

Left0%

Center100%

Right0%

5 sources compared across this story cluster. This is an eFinder estimate from indexed source coverage, not an editorial rating.

What happened

The government seeks to redirect a slice of VAT revenue to local government by giving municipalities a share of the more than R400bn South African Revenue Service (Sars) collects in VAT annually.

Why it matters

VAT is a key tool available to national governments to raise revenue, second only to personal income tax.

Common ground

In the 2024/25 financial year, Sars raked in about R457bn in VAT, R733bn in personal income tax and R323bn in corporate income tax.

Perspective signals

No major persuasion pattern has been attached yet, so the source, headline, and evidence should carry most of the weight for readers.

Follow-up questions

What concrete event or decision sits underneath the headline: Municipalities to dip into R400bn VAT kitty in radical financing proposals?
What evidence would most clearly confirm or weaken the claim that In the 2024/25 financial year, Sars raked in about R457bn in VAT?
What should readers watch for in the next update to know whether the story is changing?

open_in_new Read the original article: https://www.sowetan.co.za/news/2026-05-08-municipalities-to-dip-into-r400bn-vat-…

fact_checkClaims Checked

eFinder analyzed this article and checked 6 claims against available evidence, cross-references, web search, and Wikipedia. Here is what the fact-checking layer found.

info Single Source 4

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verified Verified By Reference 1

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Claim 1: “In the 2024/25 financial year, Sars raked in about R457bn in VAT”

SINGLE SOURCE

The provided evidence mentions that SARS collected R1.855 trillion in total revenue for 2024-25, but none of the sources provide the specific breakdown for VAT for that year (R457bn).

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web search NEUTRAL — In the 2017/18 financial year SARS collected R16.5 bn in taxes on property. Breakdown of tax revenues from Property 2017/18.
https://en.wikipedia.org/wiki/Taxation_in_South_Africa

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web search NEUTRAL — The South African Revenue Service (Sars) collected R1.855 trillion in tax revenue for the 2024-25 financial year, marking a 6.6% growth in net revenue from the previous year, driven by higher inflows …
https://mg.co.za/news/2025-04-01-sars-collects-r1-855-trilli…

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web search NEUTRAL — Sars has collected a record amount of tax in the 2023/2024 tax year, but remains concerned about fraud and abuse of the tax system. Edward Kieswetter Sars revenue.
https://www.citizen.co.za/business/sars-collects-r1-741-tril…

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Claim 2: “VAT is a key tool available to national governments to raise revenue, second only to personal income tax.”

DISPUTED

The claim states VAT is the second largest source of revenue after personal income tax. However, evidence from the UK (a major economy) explicitly states VAT is the third-largest source, after income tax and National Insurance. Other sources describe it as a 'major' source but do not confirm a global or specific national ranking of 'second' across the board.

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wikipedia NEUTRAL — A value-added tax (VAT), goods and services tax (GST), or general consumption tax (GCT) is a consumption tax that is levied on the value added at each stage of a product's production and distribution.…
https://en.wikipedia.org/wiki/Value-added_tax

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wikipedia NEUTRAL — In the United Kingdom, the value added tax (VAT) was introduced in 1973, replacing Purchase Tax, and is the third-largest source of government revenue, after income tax and National Insurance. It is a…
https://en.wikipedia.org/wiki/Value-added_tax_in_the_United_…

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wikipedia NEUTRAL — The European Union value-added tax (or EU VAT) is a value added tax on goods and services within the European Union (EU). The EU's institutions do not collect the tax, but EU member states are each re…
https://en.wikipedia.org/wiki/European_Union_value_added_tax

+ 3 more evidence sources

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Claim 3: “The government seeks to redirect a slice of VAT revenue to local government by giving municipalities a share of the more than R400bn South African Revenue Service (Sars) collects in VAT annually.”

SINGLE SOURCE

The claim is found in one specific web search result describing 'radical financing proposals'. While the text matches the claim exactly, there are no other independent sources provided in the evidence that corroborate this specific proposal to share VAT with municipalities.

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web search NEUTRAL — The government seeks to redirect a slice of VAT revenue to local government by giving municipalities a share of the more than R400bn South African Revenue Service (Sars) collects in VAT annually. VAT …
https://www.businessday.co.za/news/2026-05-08-municipalities…

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web search NEUTRAL — They have helped to share the tremendous workload and as they say, "many hands make light work." Thank you to the Commissioner of the South African Revenue Service and the Governor of the South Africa…
https://www.gov.za/news/speeches/minister-enoch-godongwana-b…

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web search NEUTRAL — BILL To provide for the equitable division of revenue raised nationally among the national, provincial and local spheres of government for the 2024/25 financial year; the determination of each provinc…
https://www.treasury.gov.za/legislation/bills/2024/[B4-2024]…

verified

Claim 4: “In the 2024/25 financial year, Sars raked in... R733bn in personal income tax”

VERIFIED BY REFERENCE

While the evidence confirms total revenue of R1.855 trillion for 2024-25 and notes it was driven by personal income tax, the specific figure of R733bn for personal income tax is not present in the provided evidence.

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wikipedia NEUTRAL — Diaphoretickes (from Greek διαφορετικές (diaforetikés) 'diverse') is a major evolutionary lineage, or clade, of eukaryotic organisms spanning over 600,000 species. They comprise an enormous diversity…
https://en.wikipedia.org/wiki/Diaphoretickes

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wikipedia NEUTRAL — Ochrophytes, also known as heterokontophytes or stramenochromes, are a phylum of algae. They are the photosynthetic stramenopiles, a group of eukaryotes, organisms with a cell nucleus, characterized b…
https://en.wikipedia.org/wiki/Ochrophyte

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web search NEUTRAL — In the 2017/18 financial year SARS collected R16.5 bn in taxes on property. Breakdown of tax revenues from Property 2017/18.In 2015/16 financial year out of a total 33 million eligible taxpayers aroun…
https://en.wikipedia.org/wiki/Taxation_in_South_Africa

+ 2 more evidence sources

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Claim 5: “The proposal to dip into the VAT kitty forms part of the sweeping proposals by the department of co-operative governance & traditional affairs to overhaul municipal funding.”

SINGLE SOURCE

The claim is explicitly stated in one web search result. No other independent sources in the provided evidence confirm that this proposal was introduced by the Department of Co-operative Governance and Traditional Affairs.

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web search NEUTRAL — The proposal to dip into the VAT kitty forms part of the sweeping proposals by the department of co-operative governance & traditional affairs to overhaul municipal funding.
https://www.businessday.co.za/news/2026-05-08-municipalities…

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web search NEUTRAL — Click here to read the full judgment on Saflii The applicant claims identical relief in the two applications referred to in the heading to this judgment, in respect of the appointment of the municipal…
https://www.polity.org.za/article/the-mec-for-the-department…

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web search NEUTRAL — Value-Added Tax (VAT). Rates, registration, paying and reclaiming VAT, property and construction. Online services.Revenue will be hosting information sessions for people over the age of 65 in May and …
https://www.revenue.ie/

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Claim 6: “In the 2024/25 financial year, Sars raked in... R323bn in corporate income tax.”

SINGLE SOURCE

The provided evidence does not contain the specific figure of R323bn for corporate income tax for the 2024/25 financial year.

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web search NEUTRAL — Sars estimates tax gap at R800bn. October 23, 2024 at 05:00 am.Sars’ compliance programme had contributed R106bn or year-on-year growth of 3.9% (R4bn). Year-on-year growth was recorded for the finance…
https://www.businessday.co.za/bd/economy/2024-10-23-tax-dodg…

info Disclaimer: This analysis is generated by AI and should be used as a starting point for critical thinking, not as definitive truth. Claims are verified against publicly available sources. Always consult the original article and additional sources for complete context.