The National Treasury on Wednesday announced there would be a tax hike come 2017. The hike, as disclosed would be done in increment.
In documents tabled during the Medium-Term Budget Policy Statement in Parliament, the department indicated that the tax rate payment of South Africans will highball from its current average of 29.9 percent to 30.4 percent by the 2019/20 financial year.
However, information as regards to whether the hike will come in the form of an increase in Value-Added Tax, corporate tax, private tax, sin tax or in the fuel levy was not related to the public.
Information on other tax categories showed that gross tax revenue collections for 2015/16 amounted to R1.07trn – R0.3bn higher than the 2016 budget estimate.
VAT recorded an over-collection of R3.1bn in 2015/16, chiefly because of lower-than-anticipated VAT refunds in the latter part of the year. Corporate income tax was an over-collection of R2.2bn. The Personal income tax had an appalling under-collection of R3.9bn.
Earlier this week, reports had it that this year’s hike in income taxes was as a result of former Finance Minister Nhlanhla Nene’s dismissal in December. The hike, the report added, was the first in the country in two decades.
With all these, the Treasury called on South Africans to brace themselves for the tax hike; which would be announced in February. It is understood that more information on the tax hike is contained in February main budget.