22 February 2018

South Africa: Budget 2018 - Tax Increases Set to Hit Ordinary South Africans Hard

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New Dawn
analysis

Everyone in South Africa will be affected by certain measures announced by Finance Minister Malusi Gigaba in Wednesday's Budget. An increased fuel levy and the 1% VAT hike will cause pain in particular for South Africa's low or no-income households - while NGOs say the commensurate increase in social grants payments will do little to cushion the blow.

A "bitter pill to swallow".

That's how the Organisation for Undoing Tax Abuse's Wayne Duvenage described the tax increases in the 2018 budget to Daily Maverick - coming as they do "against the backdrop of rampant maladministration and corruption that is the legacy of the Zuma era".

It was a sentiment apparently widely felt on Wednesday.

Public sector union the Public Servants Association (PSA) expressed concern about "the detrimental, ripple effect on especially middle- and low-income earners of the 52-cents increase on the fuel levy and the increase of VAT to 15%".

In a statement, PSA general manager Ivan Fredericks said: "The PSA understands the need to grow the GDP, but the poor should not pay a higher price to get us there."

Finance Minister Malusi Gigaba said in his Budget speech that government "has taken deliberate steps to...

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