Budget Review 2019/20

Written on 02/20/2019
Profmark Team

  • To limit the negative impact on economic growth, the 2019 Budget proposals will not increase tax rates in any category. Instead, they will increase collections by not adjusting for inflation.
  • Rebates & tax-free thresholds for natural persons have been increased
  • Medical tax credits have not changed.
  • Fuel levy increases by 29c/litre, consisting of:
    • a 15c/litre increase in the general fuel levy, 
    • a 5c/litre increase in the Road Accident Fund (RAF)levy 
    • and the introduction of a carbon tax on fuel of 9c/litre.
  • Excise duties on alcohol and tobacco products increase by between 7.4  and 9  %.
  • Employment tax incentive eligible income bands increased 
    • From 1 March 2019, employers will be able to claim the maximum value of R1 000 per month for employees earning up to R4 500 monthly, up from R4 000 previously. The incentive value will taper to zero at the maximum monthly income of R6 500.
  • Zero Rated Vat items
    • From 1 April 2019, the list will include white bread flour, cake flour and sanitary pads.
  • Carbon tax will be implemented on 1 June 2019.
    • It gives effect to the polluter-pays principle, prices greenhouse gas emissions and aims to ensure that businesses and households take these costs into account in their production, consumption and investment decisions. 
  • Urban development zone tax incentive
    • This incentive was introduced in 2003 to encourage investment in urban development zones in 16 municipalities. It is due to expire on 31 March 2020. Government will review the incentive in 2019 to determine whether it should be extended.