The Good, the Bad, and the Ugly in 2025

As the year draws to a close and South Africans head to the beach or the bush, it’s an opportune time to reflect on the year that was. 2025 was a good year, but it was also bad – and things got ugly too. It’s impossible to capture this intense, chaotic year in one go, but I will give it a try.

UGLY: Cyril signs the Expropriation Act

The year started off on an ugly note with the signing of the Expropriation Act by President Cyril Ramaphosa in late January.

The Act makes provision for “nil compensation” to be paid for expropriation according to a vaguely defined “public interest” provision. This is a departure from the concept of “public purpose”, a well-established and legitimate feature of eminent domain legislation in other countries (used when the state expropriates private property to build a road or a dam, for example).

In abandoning the principles of public purpose and market-related compensation, the Expropriation Act attempts to achieve by legislative means what the constitutional amendment of 2021 sought and failed to do: undermine sections 25(2) and (3) of the Constitution mandating compensation for acts of expropriation by the state.

Private property rights are the cornerstone of a free society and a market economy. Without these protections, investment will dry up and civil liberties will be imperilled, which is why we at Free Market Foundation (FMF) called for sweeping opposition to the Expropriation Act across all spheres of civil society and politics.

The civil society response has been more comprehensive than the political response.

Although the Democratic Alliance (DA) has joined court action against the Act, the DA Minister of Public Works has downplayed the risks. Other political parties, organised business, and agricultural associations have been similarly ambivalent.

In September, business group Sakeliga revealed a test case of expropriation without compensation (EWC) involving a multimillion Rand 34-hectare property development in Driefontein, east of Johannesburg. After a six-year unresolved dispute, the developer has reluctantly resorted to legal action against the City of Ekurhuleni after the city failed to compensate him for land expropriated for a public housing initiative.

The Driefontein case showed that the risk of EWC is real – and already present.

GOOD: The VAT hike that wasn’t – and a balanced budget

In February, Finance Minister, Enoch Godongwana abruptly postponed the tabling of the National Budget in Parliament. The reason: a proposed increase in the standard value-added tax (VAT) rate from 15% to 15.5% on 1 May 2025, with a further increase to 16% proposed for April 2026.

Coalition partners were not happy and refused to pass the Budget on two occasions. Following court challenges by the DA and widespread civil society objections – including from the FMF – the proposed VAT increase was scrapped and the Budget was finally passed in May.

The Budget fracas started as a bad but turned into a good: it revealed how overburdened South African taxpayers have had enough of carrying the costs of a spendthrift government.

This year’s Tax Freedom Day – the day you stop paying taxes and start paying yourself – fell on 16 May. In 2026, Tax Freedom Day needs to move a lot earlier in the calendar. The best way to achieve that is to lower taxes across the board and to eliminate some taxes entirely (we can start with capital gains tax).

It was with some relief and a glimmer of hope that the Medium-Term Budget Policy Statement in November revealed a degree of fiscal consolidation, with a primary fiscal surplus of 0.9% and a stabilisation of sovereign debt (still high at 77.9% in 2025/26 but not getting worse). Economic growth, however, remains stagnant, projected at just 1.2%, down from 1.4% projected in the May Budget.

GOOD: A lower inflation target

At the same MTBPS the Minister of Finance revealed that he had reached an agreement with the South African Reserve Bank (I thought the Reserve Bank was independent?) to revise the inflation target down from the range of 3 – 6% to 3%.

Inflation affects everyone, but poor people – who rely on income from their labour and who lack assets – are affected most of all. Lowering the inflation target sends a strong signal of the central bank’s commitment to its mandate of protecting the value of the currency.

BAD: The breakdown in the US-SA relationship

The relationship between the United States (US) and South Africa reached historic lows this year, culminating in a bust-up in the White House in May.

Donald Trump has been (mostly) right about South Africa: there is no genocide against whites, but the South African President refuses to condemn violent rhetoric directed at Afrikaners. Nor does he acknowledge that farm murders are a unique problem requiring special attention. These are the “treasonous” requests of AfriForum and Solidarity, who have been lobbying vigorously in Washington throughout the year.

In the wake of the threats from the White House, local commentators rushed to defend South Africa’s “sovereignty,” but failed to acknowledge the preponderance of race-based laws and the threats to private property rights in the form of EWC, which Trump was quite correct in pointing out. South Africa is also a little too cosy with US enemies like Iran and China.

Regardless of how you feel about Donald Trump – I object to his trade protectionism, for example – you need to take him seriously. Trump is a transactional politician who likes nothing more than to strike a deal.

And South Africa has a lot to gain from a deal with the Americans.

Their interest in South Africa’s strategic minerals could be of great economic benefit to us. Instead, South Africa remains without a trade agreement or an ambassador in Washington (after the last one was deemed a persona non grata and ejected) and has now been excluded from next year’s Group of 20 (G20) meeting to be hosted in Miami.

UGLY: Ratcheting up of race-based laws

In September, new regulations for the Employment Equity Amendment Act (EEAA) were gazetted, requiring all businesses to comply with strict five-year “sector numerical targets” – effectively employment quotas – based on race, sex, and disability.

Perniciously, the EEAA regulations compel employers to report on the racial composition of their staff, even when employees refuse to self-classify. In a request to the Department of Labour, the National Employers Association of South Africa (NEASA), recently revealed that the apartheid-era Population Registration Act was being used as the basis for the involuntary racial classification of employees.

As I argued last week, the EEAA is social engineering under the guise of redress – a morally repugnant law that demands consciousness objection from all South Africans.

GOOD: Exposing race law – and pushing back

My colleague, Martin van Staden, has made what has arguably been the most significant contribution to public discourse in 2025 with his widely debated Index of Race Law, a project he leads on behalf of the Institute of Race Relations (IRR).

Van Staden is a constitutional law scholar, but it was his arithmetic skills that garnered the attention of the world: his research revealed a staggering 145 race laws still on South Africa’s statute books. Van Staden’s simple, but impactful graph illustrating this lamentable state of affairs has been reposted by Elon Musk on several occasions this year on X.com (Musk’s latest post was viewed over 16 million times).

In June, the Solidarity Research Institute and the FMF released a report on the high compliance costs of broad-based black economic empowerment (B-BBEE), which regular readers of this column will be familiar with. The report revealed that B-BBEE compliance incurred annual costs of between R145 billion and R290 billion, reducing GDP growth by between 1.5% and 3% per year and resulting in between 96 000 and 192 000 jobs lost annually.

Ahead of the G20 meeting in November in Johannesburg, Solidarity erected billboards around the city, welcoming delegates to “the most race-regulated country in the world”, which raised the ire of Gauteng Premier, Panyaza Lesufi, whose goons tore down one of the giant posters. The courts ordered that Solidarity be compensated, a small victory against state censorship.

Opposition to B-BBEE grew in 2025, with civil society groups like Sakeliga, the IRR, and the FMF taking firm positions in the courts and in the public domain. The IRR’s proposed Economic Empowerment for the Disadvantaged (EED) policy and the DA’s Economic Inclusion For All Bill are both serious non-racial policy alternatives to B-BBEE.

Onwards to 2026

For me, 2025 was filled with new beginnings, including the start of this column. It’s hard to believe that The Common Sense was only launched in September. It already feels like an established presence in the South African media landscape. I look forward to sharing more of my thoughts with you here in the year to come.

May liberty be your guiding light.

Ansara is CEO of the Free Market Foundation.