How much you will be taxed in South Africa in 2023 – based on what you earn
Finance minister Enoch Godongwana has outlined the new tax brackets for personal income taxpayers in his Budget speech 2023 on Wednesday (22 February).
The personal income tax brackets will be fully adjusted for expected inflation for the year – 4.9% – which should provide some relief to South African taxpayers.
Increasing brackets by a value less than inflation is often used as an easy way to draw in revenue, as many taxpayers are pushed into higher brackets and subsequently end up paying more tax.
For the 2023/24 financial year, however, this is not the case. The adjustment by inflation will also increase the tax-free threshold from R91,250 to R95,750, the minister noted.
Medical tax credits will also be increased by inflation, to R364 per month for the first two members and to R246 per month for additional members.
The tables below outline the tax brackets for 2023:
According to Godongwana, Tax revenue collections for 2022/23 are expected to total R1.69 trillion. This exceeds the 2022 Budget estimate by R93.7 billion, and the 2022 MTBPS estimate by R10.3 billion.
Over the medium-term, revenue projections are R6 billion higher than the estimates of the 2022 MTBPS.
As a result, there are no major tax proposals in the budget, he said.
“The improvement in revenue is due to higher collection in corporate and personal income taxes, and in customs duties. This partially offset the lower value-added tax estimates.
“Our country is reaping the benefits of a more efficient and effective tax administration, that is building trust to increase voluntary compliance and boost revenue collections,” the minister said.
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