Group to absorb VAT increase for three months, challenges others to follow suit
22 March 2018 | Web Article Number: ME20189052
FAST-moving consumer goods company (FMCG) processor and distributor, Willowton Group, has announced that they will absorb the one percentage point increase in the value added tax rate during April, May and June, effectively shielding their consumers from the VAT increases announced recently in the national budget.
“We truly believe that there is no better feeling than giving back to the South African community and, right now, the community needs our support,” said Willowton Chief Executive Officer, Zubeir Moosa.
“The VAT increase will be felt by every individual with already stretched budgets battling to meet rising prices. Our range of quality products are consumed and used primarily by those in lower to middle income groups and we feel it is our responsibility, as a socially-conscious organisation, to take on the financial burden and offer our valuable customers some form of respite.”
VAT goes up from 14% to 15% on 1 April 2018 and is the first hike since 1993. The government is also investigating expanding the goods exempt from attracting the tax as a means for assisting poorer households.
Whilst many of Willowton’s products such as cooking oil, maize meal and rice are VAT free, there are an equal number of products such as margarine, soaps and candles that attract VAT.
Moosa said the group will absorb the 1% VAT increase coinciding with the introduction of the higher rate on all its branded consumer retail packaged products, including Sunfoil, Crown, Allsome, Sunshine D, Romi, D’lite, Wooden Spoon, Cordon Bleu, Sona and Britelite range of products, whilst paying the 15% VAT to SARS.
The savings will apply to all Willowton clients and store outlets.
“We also challenge other FMCG companies and retailers to follow our lead in protecting the already hard-hit consumers of this country,” Moosa said.