The 2015 budget speech
THE 2015 BUDGET SPEECH
TAX PROPOSALS
The 2015 budget tax proposals aim to increase tax revenues as required, limit the erosion of the corporate tax base, increase incentives for small businesses and promote a greener economy.
The main tax proposals are as follows.
1. Personal income tax rates will be raised by one percentage point for all taxpayers earning more than R181 900 a year. The tax rates are as follows for 2016 tax year:
| Taxable Income (R) | Rate of Tax (R) |
| 0–181 900 | 18% of taxable income |
| 181 901–284 100 | 32 742 + 26% of taxable income above 181 900 |
| 284 101–393 200 | 59 314 + 31% of taxable income above 284 100 |
| 393 201–550 100 | 93 135 + 36% of taxable income above 393 200 |
| 550 101–701 300 | 149 619 + 39% of taxable income above 550 100 |
| 701 301 and above | 208 587 + 41% of taxable income above 701 300 |
2. An increase in the general fuel levy of 30.5 cents per litre plus an increase of 50 cents per litre for the Road Accident Fund levy (resulting in a total increase of 80.5 cents per litre).
3. A more generous tax regime is proposed for businesses with a turnover below R1 million a year and those with a turnover below R335 000 a year, respectively.
4. Transfer Duty is amended as follows:
| Value of property (R) | Rate |
| 0–750 000 | 0% |
| 750 001–1 250 000 | 3% of the value above R750 000 |
| 1 250 001–1 750 000 | R15 000 + 6% of the value above R1 250 000 |
| 1 750 001–2 250 000 | R45 000 + 8% of the value above R1 750 000 |
| 2 250 001 and above | R85 000 + 11% of the value above R2 250 000 |
5. Sin taxes will increase as follows:
- 15 cents on a quart of beer;
- 15 cents on a bottle of wine;
- 48 cents on a bottle of sparkling wine;
- R3.77 on a bottle of whisky; and
- 82 cents on a pack of 20 cigarettes.
6. Amendments to the diesel refund system have been proposed (applicable in the agriculture, forestry, fishing and mining sectors). Some of these changes will be implemented this year and the rest in 2016.
7. Proposed tax measures to promote energy efficiency:
- Temporary increase in the electricity levy, from 3.5c/kWh to 5.5c/kWh;
- An increase in the energy-efficiency savings incentive from 45 c/kWh to 95 c/kWh; and
- The introduction of a carbon tax in 2016.
8. Further steps will be taken to combat erosion of the tax base by closing evasion loopholes and addressing profit shifting and illicit money flow.
9. A one-year relief measure proposed in respect of Unemployment Insurance Fund contributions.
10. The proposal is that UIF contribution threshold should be reduced to R1 000 a month for the 2015/16 year.
11. A final Withholding Tax on Interest at a rate of 15% is imposed on interest from a South African source payable to non-residents (with effect from 1 March 2015). Interest is exempt if payable by any sphere of the South African government, a bank, or if the debt is listed on a recognised exchange.
Bissets Boehmke McBlain Attorneys
February 2015
26 Feb 2015
Author Bisset Boehmke McBlain Attorneys