In a significant move to make basic necessities more affordable, the South African government has announced the addition of new VAT-Free food items to the list of zero-rated products. This means that these essential foods will no longer be subject to the 15% Value-Added Tax (VAT), reducing their cost for consumers.
The latest expansion of VAT-Free food items aims to support lower-income households by making nutritious food more accessible. In this article, we explore the newly added VAT-Free food items, why they were chosen, their impact on South Africans, and how consumers can maximize their savings.
What Are VAT-Free Food Items?
VAT-Free food items, also known as zero-rated food products, are those that are exempt from VAT. Unlike VAT-exempt goods, where businesses cannot reclaim input VAT, zero-rated items allow suppliers to recover VAT on production costs while ensuring consumers do not pay VAT at the point of sale.
This system is designed to lower the cost of essential foods, benefiting individuals and families who rely on these staples.
Read More: New VAT-Free Food Items Announced – But Not Everyone Is Impressed
New VAT-Free Food Items in South Africa (2025 Update)
As of 1 May 2025, the South African government has expanded the list of VAT-Free food items to include:
1. Edible Offal
This includes various parts of animals that are widely consumed in many South African households, such as:
- Liver, kidneys, and hearts
- Heads, feet, and bones
- Tongues
- Other offal from bovine animals, sheep, goats, swine, and poultry
2. Dairy Liquid Blend
- A combination of dairy-based liquids used in cooking and baking.
3. Tinned or Canned Vegetables
- All preserved vegetables in tins or cans are now included as VAT-Free food items.
These additions aim to broaden access to protein-rich foods and preserved vegetables, ensuring better nutrition for lower-income families.
Why Have These New VAT-Free Food Items Been Added?
The decision to include more VAT-Free food items is part of the government’s broader strategy to combat rising food prices and support vulnerable households. The main reasons for this expansion are:
1. Ensuring Affordable Protein Sources
- Edible offal is an affordable protein source that many South Africans rely on, especially in lower-income communities.
- Including offal in the VAT-Free food items list makes it even more accessible.
2. Increasing Access to Nutritious Food
- Tinned vegetables are a convenient and long-lasting source of essential vitamins and minerals.
- Making them VAT-free encourages healthy eating habits.
3. Reducing Household Expenses
- VAT-Free food items help South Africans stretch their grocery budgets further.
- Families can buy more essential foods without worrying about VAT-inflated prices.
4. Strengthening Food Security
- By making staple foods more affordable, the government is addressing food insecurity.
- Many people in South Africa struggle with unpredictable food prices—this policy provides relief.
How This Change Will Benefit Consumers
The inclusion of new VAT-Free food items will have direct benefits for households across South Africa. Here’s how:
1. Lower Prices for Essential Foods
By removing VAT from offal, dairy liquid blends, and canned vegetables, families will see immediate savings on their grocery bills.
2. More Nutritional Options
- Protein intake is vital for overall health. With cheaper offal, more South Africans can afford nutritious meals.
- Canned vegetables provide long-lasting and vitamin-rich options.
3. Savings for Large Families
- Families spending hundreds of rands on groceries each month can save significantly by purchasing more VAT-Free food items.
4. Easier Access to Staple Foods
- These changes ensure that even in remote or rural areas, essential foods remain affordable and readily available.
Related: What Did R500 Buy You in 2015 vs 2025? (Groceries Comparison in South Africa)
Challenges and Concerns About VAT-Free Food Items
While these changes are welcomed, some industry experts have raised concerns:
1. Will Retailers Pass on the Savings?
- Some economists warn that removing VAT does not guarantee lower prices—retailers must pass the savings to consumers.
- The government and consumer watchdogs need to monitor price changes.
2. Some Important Foods Are Still Taxed
- The South African Poultry Association (SAPA) has argued that frozen bone-in chicken should also be zero-rated.
- Many South Africans rely on chicken as a protein source, but it remains subject to VAT.
3. Will These Changes Be Enough?
- While the addition of new VAT-Free food items is positive, some analysts believe that direct cash assistance to low-income households might be more effective.
How to Make the Most of VAT-Free Food Items
To maximize your savings when shopping for VAT-Free food items, follow these tips:
1. Check Labels in Stores
- Look for official zero-rated product signs to avoid accidentally paying VAT.
2. Compare Prices at Different Supermarkets
- Some retailers may still charge higher prices—so shop around.
3. Buy in Bulk
- For canned vegetables and dairy blends, buying in bulk can help you save even more.
4. Plan Meals Around VAT-Free Foods
- Using more zero-rated ingredients in your meals will reduce overall grocery expenses.
Final Thoughts on VAT-Free Food Items in 2025
The government’s decision to expand the list of VAT-Free food items is a step toward making food more affordable for millions of South Africans. With the addition of edible offal, dairy liquid blends, and tinned vegetables, lower-income families will now have cheaper and healthier food options.
However, it remains important for consumers to stay informed and ensure retailers pass on VAT savings. Moving forward, continued policy adjustments and additional zero-rated items may be needed to further support food security in South Africa.
