What’s in store for you from the Taxman?

By Nadia Samie
20 February 2008

Many tuned in to Finance Minister Trevor Manuel’s budget speech, delivered in Parliament on Wednesday, to hear what they would have to cough up this year in taxes.

There is slight relief for individuals. The minister announced adjustments to the personal income tax schedules that will see relief of R7.2 billion, which compensates for the effects of inflation. A third of the benefits goes to those with a taxable income of below R150 000 per year. It will further benefit those in the R150 000 to R250 000 annual income bracket. People earning less than R46 000 per year are exempt from paying tax.

Further tax proposals included:

Petrol and diesel taxes will increase by 11 cents from 2 April 2008;

Cigarettes will cost 66cents more per pack of 20;

A litre of wine will cost 12 cents more;

A 340ml can of beer will cost 7.2 cents more;

A bottle of liquor (spirits) will cost R2,17 more;

A simplified tax regime for small businesses;

Measures to encourage employers to provide bursaries for the children of middle and low income employees;

A reduction in the corporate income tax rate from 29 percent to 28 percent;

An electricity levy of 2 cents per kilowatt hour;

R5 billion in tax subsidies over the next three years for labour-intensive industries and industrial policy

Director-General in the Department of the Treasury Lesetja Kganyago says that in this period of global volatility, the economy must remain resilient, adding that more fiscal resources must go into investment that in consumption.

Documents pertaining to the 2008 Budget can be found on the web at www.treasury.gov.za.