BUDGET PROPOSALS 1 Super Tax
A new super tax bracket of 45% for taxable income in excess of R1,5 million was introduced for individuals and as a consequence the flat rate for trusts has also increased to 45%.
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Dividend Tax
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Further Refinements to Section 7C (Loans to Trust)
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Estate Duty
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Expanding the VAT base
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Annuitisation-Provident Funds
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Sugar Tax
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Base Erosion and Profit Shifting
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Carbon Tax
As from 22 February 2017 the dividends withholding tax has increased to 20% resulting in the corporate effective tax rate increasing to 42,4%. Further anti-avoidance measures are being considered to counter the structure whereby the planner makes an interest-free loan to a company owned by the trust, which currently falls outside the ambit of Section 7C. The recommendations of the Davis Tax Committee will be considered in the 2018 budget speech. Consideration to removing the zero-rating of fuel will be subject to consultation prior to the 2018 budget speech. Taxable services will be extended to include cloud computing and services provided using online applications. The annuitisation of retirement benefits for provident funds has been postponed to 1 March 2018 for further consultation at Nedlac. Should no agreement be reached the continuation of the tax deduction will be reviewed. Tax on sugary beverages is postponed from 1 April 2017 due to delays in the parliamentary process.
South Africa is on track in meeting the minimum standards set out in the 15 action items of the OECD base erosion and profit shifting project.
A revised Carbon Tax Bill will be published for consultation in 2017.
10 National Gambling Tax A National Gambling Tax Bill and a National Gambling Tax
Administration Bill will be tabled in 2017.
This booklet is published by PKF Publishers (Pty) Ltd for and on behalf of
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All information contained herein is believed to be correct at the time of publication, 22 February 2017. The contents should not be used as a basis for action without further professional advice. While utmost care has been taken in the compilation of this publication no responsibility will be accepted for any inaccuracies, errors or omissions. The information incorporates commentary from the budget speech but the legislation finally enacted may differ considerably. Changes in rates of tax announced in the budget speech for the 2018 tax year become effective only once the legislation is enacted by Parliament. Copyright subsists in this work. No part of this work may be reproduced in any form or by any means without the publisher’s written permission.
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