At a time when the South African economy needs revenue to jack up its economic fortune, the country has announced a sharp decline in tax revenue collection.
The decline was announced recently during the delivery of the 2024 National Budget Speech by South Africa’s Finance Minister, Enoch Godongwana who revealed that the R1.73 Trillion budgeted for 2024 is lower than the R56.1 Billion estimated for 2023.
Taxmobile.Online has curated 10 key highlights that you need to have in mind regarding the tax revenue decline bedevilling the South African Economy and tax revenue drive.
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10 Highlights as Tax Collection in South Africa Declines
Weak economic performance led to a sharp decline in tax revenue collection for 2023/24.
Tax revenue for 2023/24 is R56.1 billion lower than estimated in the 2023 Budget.
The decline in corporate profits and revenue from taxes on mining contributed to the shortfall.
Medium-term revenue projections are R45.6 billion higher than 2023 estimates, due to increased personal income tax and additional revenue proposals.
Tax measures proposed to raise R15 billion in 2024/25 to alleviate fiscal pressure and support debt stabilization.
Revenue is primarily raised through personal income tax by not adjusting tax brackets, rebates, and medical tax credits for inflation.
Proposed above-inflation increases for alcohol products excise duties, tobacco excise duties, and excise duty on electronic nicotine and non-nicotine delivery systems (vapes).
Carbon tax increased from R159 to R190 per tonne of carbon dioxide equivalent, with fuel levy increases for petrol and diesel.
Discussion paper to be published for public comment on proposals for the second phase of the carbon tax.
No increases are proposed for the general fuel levy for 2024/25, resulting in tax relief of around R4 billion for consumers.