The approval of South Africa’s budget in the National Assembly, by 194 votes to 182 after several false starts, may have inflicted terminal damage on the fledgling Government of National Unity, and particularly the partnership between the African National Congress and the Democratic Alliance. The second largest party in the coalition, the DA voted against the budget on 2 April, hours after ANC Finance Minister Enoch Godongwana told lawmakers that they should not stay in a government whose budget they opposed.

At the heart of the row was Godongwana’s determination to increase VAT to pay for spending rises on education and healthcare as well as civil servants’ salary hikes and more spending on infrastructure. The DA had insisted that it would only support tax rises if they were temporary and accompanied by structural reforms.

Unlike recent budget rows in Nigeria and Kenya, the dispute in Cape Town is not over how much pain voters will tolerate in terms of tax rises and spending cuts but over the size and role of the state. Godongwana had been forced to water down previous plans to increase VAT from 15% to 17% down to 16% and phased in over two years. A VAT rise was an odd choice for the ANC, and one which opposition parties such as the leftist Economic Freedom Fighters and Jacob Zuma’s uMkhonto weSizwe will exploit. One of the most regressive indirect taxes, it hits the poorest disproportionately hard.