We are holding our breaths at the moment, and anxiously speculating on what the Annual Budget speech will bring us this year.
Finance Minister Pravin Gordhan, who was reappointed at the end of last year, will be presenting the budget speech to Parliament on the 24th February 2016, at 2pm.
Rumours of leaked information, predictions and statistics are steadily making the rounds.
It’s no secret that tough times lie ahead. This was strongly conveyed to us in last year’s Mini budget speech by former Minister of Finance, Nhlanhla Nene. The question we ask this year is, how tough is it going to be?
If we look back at the 2015 Budget, Minister Nene increased both personal income tax and the general fuel levy which was utilised to subsidise the Road Accident Fund. Over the past year, South Africa endured 2 credit rating downgrades and overall poor economic growth with an increasing budget deficit. With this in mind, it would be naïve of us not to expect another tax rise.
In addition, the #FeesMustFall campaign, which was considered a great success for students, will result in additional shortfalls where the budget is concerned, due to President Zuma introducing a zero percent increase to tuition fees.
Middle income earners, already paddling profusely to keep their heads above water, will feel the greatest pinch in 2016 with personal income tax predicted to increase once again.
According to Finance 24, ‘The Davis Tax Commission, tasked with looking at an overhaul of the country’s taxation system, said in a report that of the three sources of tax - corporate, personal income and consumer tax - value-added tax (VAT) would be the least disruptive to employment and economic growth.’ This will affect every level of society.
Should you wish to take the next step and listen to one of the foremost tax authorities in South Africa, Professor Jackie Arendse, call Accsys on 0861 222 797.
Accsys, a member of Business Connexion and a national supplier of People Management Software within the Payroll, HR and Time and Attendance space, are hosting their annual Budget Speech update, presented by Professor Arendse, on the 11th March, at the Johannesburg Country Club, Woodmead.
Article written by: Clara Namnick, Marketing & Communications Manager