Budget 2017: What government will earn - and forgo - from new tax changes

22 February 2017 - 16:22 By Businesslive
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The proposed new top personal income tax rate of 45% for the estimated 100‚000 individuals with taxable incomes above R1.5m will raise R4.4bn. The previous top bracket of 41% was set at R701‚301.

Limited relief of R2.5bn for fiscal drag of R14.6bn will raise R12.1bn more in tax. An increase in the withholding tax on dividends from 15% to 20% will raise R6.8bn.

  • LIVE: Pravin Gordhan delivers 2017 BudgetA politically "vulnerable" Pravin Gordhan will deliver what could be his last Budget speech today - and he is expected to make an announcement on tax increases that could make everyday lives more difficult. 

A further R5.1bn will be raised by an increases of 30c/litre in the general fuel levy (R3bn)‚ 9c/litre in the road accident fund levy‚ and in excise duties for alcohol and tobacco of between 6% and 10%‚ which will raise R1.9bn more.

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The primary‚ secondary and tertiary rebates and the levels of all the taxable income brackets will increase by 1%‚ and the tax-free threshold rises slightly from R75‚000 to R75‚750.

The tax proposals also include an increase in the threshold for the payment of transfer duty on house purchases from R750‚000 to R900‚000. This will cost the fiscus R448m in tax forgone.

The annual allowance for tax-free saving accounts will be increased to R33‚000.

The medical tax credit will be increased for the first two beneficiaries from R286 to R303 a month‚ and for remaining beneficiaries from R192 to R204 per month.

Government guarantees to public institutions now amount to R478bn.

- TMG Digital/BusinessLIVE

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