Mboweni under pressure to come up with turnaround plan as VAT collections dip

[The_Right_Honourable_Brit]

The government has, for the first time since the recession in 2008, collected less VAT, despite the 1 percentage point hike that came into effect in April last year, setting the VAT rate from 14% to 15%.

Experts believe the revenue collection target of R1.422 trillion may have to be reduced by between R30 billion and R50 billion during next month’s medium-term budget policy statement, as a result of lower-than-expected company tax and VAT collection.

This revenue shortfall is likely to place significant pressure on Finance Minister Tito Mboweni to generate a practical and realistic turnaround plan for the economy.

Kyle Mandy, a partner and technical head of tax at PwC SA, said it was difficult to make accurate predictions because figures from only four months of the financial year (April to July) were currently available.

Still, he said, he expected that estimated revenue would be adjusted downward by between R30 billion and R45 billion.

Company taxes would constitute the majority of the figure, with an estimated R20 billion less revenue, R5 billion less VAT, R3 billion less personal revenue, and the rest constituting other forms of taxation, such as customs and the fuel price levy.

Economist Mike Schüssler wrote last week that according to his calculations, government’s VAT revenue would decline for the first time since the financial crisis in 2008/09 in nominal terms (without adjusting for inflation).

Mboweni under pressure to come up with turnaround plan as VAT collections dip | Citypress

The government has, for the first time since the recession in 2008, collected less VAT, despite the 1 percentage point hike that came into effect in April last year, setting the VAT rate from 14% to 15%.

city-press.news24.com

 

[Jopie Fourie]

Lol

If Mboweni and Ramaphosa thought they would generate more income tax by increasing VAT rate, introducing new taxes or even increasing PIT, they should rather step down and hand the government to the FF+ and fire all their financial advisers.

This is only the start. They will see the real decline in 2020 and upwards. They should start by looking at cutting grants if they still want to survive another 5 years.

 

[Mila]

Undermine business growth by racist policies, screw all small businesses with racist policies
BEE
NHI
Land grabs
Anc

just to name a few.
Who would have thunk this would have been the result.

i know a few businesses ( me included) that are now cash only.
Screw the ANC and SARS. This is the bundus now. Each one for themselves.

 

[krycor]

I’ll say it again, MTBS end of next month is gonna be fun to watch as PIT, Prescribed Assets & VAT has to be under consideration and they have to indicate either all of which will have the same impact ie anyone paying tax getting hit for more which is just gonna bleed more tax payers out of SA.

 

[stormiezzz]

If you increase tax, you are chasing your tax base overseas. Simple as that. Reduce tax, the price of electricity, and the fuel levy.

 

[R13...]

Undermine business growth by racist policies, screw all small businesses with racist policies
BEE
NHI
Land grabs
Anc

just to name a few.
Who would have thunk this would have been the result.

i know a few businesses ( me included) that are now cash only.
Screw the ANC and SARS. This is the bundus now. Each one for themselves.

Land and NHI are too new to have an impact on current tax collections and aren't even implemented yet but yes may affect sentiment. The rest have been there since forever and have not showed an impact on tax collections which started falling when Zuma wrecked SARS. The low business confidence and economic growth are obviously contributing a large chunk of the shortfalls. And maybe some from people passive aggressively revolting.

 

[Jopie Fourie]

Land and NHI are too new to have an impact on current tax collections and aren't even implemented yet but yes may affect sentiment. The rest have been there since forever and have not showed an impact on tax collections which started falling when Zuma wrecked SARS. The low business confidence and economic growth are obviously contributing a large chunk of the shortfalls. And maybe some from people passive aggressively revolting.

NHI I will agree with you. Appropriations too. Land has been an issue for a few years and I know a large number of farmers who sold off and moved abroad to the US, South America and Europe due to fears of land. Not mentioning a large number of private individuals who left the country too.

NHI and appropriations will have a much bigger impact than land. They are about to see this next year. I know that a large number of people are now in the process of cancelling RA's, investments and many even resigning just to get portions of their pension funds paid out - if you read the newspapers you will see an article almost every day of investment houses asking people not to do this, because it already is becoming a massive problem for them. I also know a large number of families fearing the NHI and making the move before it comes into play.

 

[Temujin]

What, increasing prices results in less revenue... who would have thunk... New plan, increase it moar, that'll fix everything.... farkin dumbasses

 

[Milano]

The government has, for the first time since the recession in 2008, collected less VAT, despite the 1 percentage point hike that came into effect in April last year, setting the VAT rate from 14% to 15%.

Their socialist anti-business, anti-skills experiment is failing brilliantly as expected.

 

[Hemi300c]

Fvcking idiots
You broke the country, reached your target now it's eish.

 

[Jopie Fourie]

The apartheid government never was the enemy of the ANC. Neither was white, coloured or indian people. All along, the ANC had been their own enemy. They have brought themselves down to their knees and fired the death shot to the head. Just take a look at the ANC today, take a look at the government they run, take a look at the country they run, take a look at the economy they run, take a look at the enterprises they are involved in. They are the sole cause of everything the country experiences today.

 

[Milano]

Land and NHI are too new to have an impact on current tax collections and aren't even implemented yet but yes may affect sentiment.

Most assuredly they have already played a significant role in sentiment. The true economic devastation they will bring has yet to even be tasted.

 

[DreamKing]

the only way to increase tax revenue is to reduce taxes.

sound ridiculous, stupid people never understand what is logic behind.

 

[Jopie Fourie]

the only way to increase tax revenue is to reduce taxes.

sound ridiculous, stupid people never understand what is logic behind.

Tsek wena! What type of logic is this?

 

[AstroTurf]

Want to see vat revenue surge in the next 5 years?

Convict all that allude to or utter hate speech and incite violence, politicians specifically.

End ewc, bee and aa.

Marikana any violent protest or looting.

It's that simple.

 

[DreamKing]

Tsek wena! What type of logic is this?

ask an expert.

 

[Jopie Fourie]

The problem is that decreasing taxes in South Africa will no longer work. They have crossed the threshold for that. Government must re-align each year and get used to decreasing tax income and make do with what they get.

Unfortunately, ANC policies such as NHI, EWC, Appropriations, AA, BEE, Labour Laws and more are chasing away tax payers and also killing businesses and the economy. So many have already left the country that tax revenue are already severely impacted. More and more tax payers are still leaving the country on a daily basis.

This is an unfortunate reality for the ANC. They have no other means of increasing tax revenue. They cannot turn this around again.

 

[DreamKing]

This is an unfortunate reality for the ANC. They have no other means of increasing tax revenue. They cannot turn this around again.

never too late, the only problem is the anc.they have no intention and no abilities to turn this around..

 

[air]

Coming home to roost, these fcuking Muppets could not run a bath.

 

[newklear]

The only politician I trust is the one who has played SimCity before!