Taxman at Your Door
This edition of the Macro Review looks at South Africa’s tax regime, incorporating data on government finances within the context of the country’s economy, the different forms of tax collection, as well as key sources of revenue.
Key takeaways:
- In 2018/19 total tax revenue amounted to R1.3 trillion — 26.2% of the country’s Gross Domestic Product (GDP) of R4.9 trillion.
- Personal Income Tax (PIT), Corporate Income Tax (CIT) and Value-Added Tax (VAT) make up some 80% of national tax revenue.
- Only 1.1 million or 16.6% of assessed individual taxpayers earn above R500 000, but contribute 67.6% to individual tax assessed. A mere 6 664 or 0.1% earn above R5 million, while paying 7.9% of individual tax assessed.
- Companies with taxable income greater than R100 million amount to just 706 in number or 0.09% of companies assessed for tax, but account for 62.7% of corporate tax assessed.
- For almost forty years, South Africa has been dogged by consistent budget deficits (expenditure outstripping revenue), which show no sign of letting up in the near future.
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