ARE HIGHER TAXES ON THE CARDS?

by | Oct 29, 2020 | Article | 0 comments

Given the commitment to fiscal consolidation, tax increases of R40bn will be necessary over the next four fiscal years. Taxes are set to increase by R5bn in 2021/2022, R10bn in 2022/23 and R15bn in 2024/2025. The most effective taxes to increase would be personal income tax, which contributes 30% to government revenue and VAT which contributes approximately 25%. Other forms of taxes could also be implemented such as a wealth tax, which would be politically palatable, but can be difficult to implement. A three-year solidarity tax on high-income earners has also been mooted to help pay for the Covid-19 crisis. New tax policies will be announced in the February 2021 Budget.

(Source: AdviceworX)