Tag: National Treasury

The National Treasury announced in the 2022 Budget Review that the corporate tax rate will be lowered to 27% for years of assessment that end or on after 31 March 2023. Practically, for most companies, this means that the reduced rate applies for years of assessment that start on or after 1 April 2022 and some companies may already enjoy the effect of the reduction in 2022 when making provisional tax payments.

In 2021 amendments were proposed relating to section 20 of the Income Tax Act 58 of 1962 to limit corporate taxpayers’ ability to utilise assessed losses carried forward to 80% of the value of such assessed losses in a given year of assessment.

Budget 2022 was a ‘read between the lines’ event and should be interpreted with cautious optimism, we argue. Much weaker GDP inflation assumptions allowed the National Treasury to downplay future revenue collections, yet still bring the primary budget back into surplus a year earlier than originally planned, in line with our view.

As was widely expected, the government did not announce any increase in the VAT rate, although the Minister has stated that the tax rate will need to increase in the future. The proposed amendments affecting VAT are largely technical in nature.

The 2022 Budget was tabled to Parliament on 23 February 2022 by South African Finance Minister Enoch Godongwana.

Too many powerful and well-remunerated people in our public sector are letting South Africans down by continually failing to achieve the strategic objectives of the entities they manage. Officials in the public sector must employ clean governance principles across every aspect of their operations.

South Africa has a dedicated research and development (R&D) tax incentive regime which sets it apart from other African countries and enables South Africa to compete with similar regimes in developed countries. However, the future of this incentive is at risk.

South African fuel prices increased again on 3 November and petrol price is now at 33.9% this year with the Automobile Association of South Africa (AA) warning that R20 per litre could still be on the cards for by year end. The main reason for the pressure on local fuel prices has been a sharp increase in the brent crude oil price over the past few months.

Finance Minister Enoch Godongwana’s first significant speech since his appointment in August 2021 saw a minimal reaction from the equity market. Good news had been expected from the Medium-Term Budget Policy Statement (MTBPS) and the market signalled its satisfaction that there were no negative surprises, such as alluding to tax rate increases.

The Medium Term Budget Policy Statement (MTBPS) 2020 was tabled to Parliament on 11 November 2021 by South African Finance Minister Enoch Godongwana.