Budget 2018

Budget highlights: http://www.treasury.gov.za/documents/national budget/2018/sars/Budget 2018 Highlights.pdf

Speech: http://www.treasury.gov.za/documents/national budget/2018/speech/speech.pdf

In response, government has made significant changes to the fiscal framework.
Firstly, new tax measures raise an additional R36 billion in 2018/19, mainly through a higher
VAT rate and below-inflation adjustments to personal income tax brackets
Secondly, the expenditure ceiling has been revised down marginally from what was presented
in October.
However, the small revisions are underpinned by large reductions and reallocations.
Over the next three years, the spending framework includes:
 Expenditure reductions approved by Cabinet amounting to R85 billion.
 An allocation of R57 billion for fee-free higher education and training.
 Additions to the contingency reserve amounting to R10 billion.
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Looks balanced and quite sound. More than I expected at least.

Tax Proposals
The tax proposals for the 2018 Budget are designed to generate an additional R36 billion in
tax revenue for 2018/19.
The main tax proposals for the 2018 Budget are:
An increase in the value-added tax rate from 14 per cent to 15 per cent,
A below inflation increase in the personal income tax rebates and brackets, with greater relief for those in the lower income tax brackets,
 An increase in the ad-valorem excise duty rate on luxury goods from 7 per cent to 9 per cent,
 A higher estate duty tax rate of 25 per cent for estates greater than R30 million,
A 52 cents per litre increase in the levies on fuel, made up of a 22 cents per litre for the general fuel levy and a 30 cents per litre increase in the Road Accident Fund Levy, and
Increases in the alcohol and tobacco excise duties of between 6 and 10 per cent.

In developing these tax proposals, government reviewed the potential contributions from the
three major tax instruments which raise over 80 per cent of our revenue; personal and corporate income tax and VAT.
We have increased personal income tax significantly in recent years, particularly at the higher
income bands, and our corporate tax is high by international standards.
We have not adjusted VAT since 1993, and it is low compared to some of our peers.
We therefore decided that increasing VAT was unavoidable if we are to maintain the integrity of our public finances.
The current zero-rating of basic food items such as maize meal, brown bread, dried beans and rice will limit the impact on the poorest households.

Vulnerable households will also be compensated through an above average increase in social grants.
Some relief will be provided for lower income individuals through an increase in the bottom three personal income tax brackets and the rebates.
In addition to VAT, we are increasing excise duties on luxury goods and estate duty on wealthy individuals.
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Vat 15%, and another 55c/l on fuel taxes...

**** this
 
 A below inflation increase in the personal income tax rebates and brackets, with greater relief for those in the lower income tax brackets,


****S!
 
What in the motherTRUCK does inflation have to do with personal income tax brackets??? :wtf:

Government failures contribute to inflation, but hey let's sweep that under the rug by adjusting tax brackets accordingly. Did this retard learn that tactic from DSTV? So the consumer in this case gets screwed twice, first by inflation then by higher tax. s-l-o-w c-l-a-p Gigupta
 
powermzii said:
yeah we gonna feel that... so that means food goes up by what - 15%...? FML. And that 15% is just a figure i plucked from the air because we gonna get shafted
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Huh, your maths is fscked my son...

EVERYTHING will go up by around 1%....
 
NarrowBandFtw said:
What in the motherTRUCK does inflation have to do with personal income tax brackets??? :wtf:

Government failures contribute to inflation, but hey let's sweep that under the rug by adjusting tax brackets accordingly. Did this retard learn that tactic from DSTV? So the consumer in this case gets screwed twice, first by inflation then by higher tax. s-l-o-w c-l-a-p Gigupta
Click to expand...

Normally, tax brackets are shifted each year by the value of inflation - so if you get an inflation-related increase, you stay in the same place tax wise.
Now, with a below increase adjustment to brackets, your inflation-related increase is taxed at a higher rate.
 
NarrowBandFtw said:
What in the motherTRUCK does inflation have to do with personal income tax brackets??? :wtf:
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You want the brackets to increase with inflation so that next year you are taxed relatively the same as this year. It has a lot to with it. So increasing the tax brackets by less than inflation is actually a decrease for us.
 
Sinbad said:
Normally, tax brackets are shifted each year by the value of inflation - so if you get an inflation-related increase, you stay in the same place tax wise.
Now, with a below increase adjustment to brackets, your inflation-related increase is taxed at a higher rate.
Click to expand...
phoneJunky said:
You want the brackets to increase with inflation so that next year you are taxed relatively the same as this year. It has a lot to with it. So increasing the tax brackets by less than inflation is actually a decrease for us.
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Thanks for that, I misread that the rates are adjusted, not the brackets. So the red mist set in ...
 
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