Business

10 things you need know about tax in South Africa in 2016

Staff Writer

 ·29 Nov 2016

New tax data shows that tax revenue collection for 2015/16 increased to R1.07 trillion, up by R83.7 billion or 8.5% from the 2014/15 period.

The report – Tax Statistics 2016 –  published by the South African Revenue Service (SARS) and National Treasury, showed that there are 19 075 270 individuals registered to pay tax as of March 2016, with 4 788 334 assessed and 6 662 490 expected to pay.

There are 458,048 employers registered with the tax body.

SARS said there were 3.3 million registered companies (of which about 900,000 submit income tax returns) and 706,874 registered Value-Added Tax (VAT) vendors of which 425,225 (60.2%) were active.

The eFiling payments channel constitutes most of the number of payments received by SARS and accounted for 75.9% of the total value of all taxpayer payments in 2015/16.

The report provides an overview of tax revenue collection and tax return information for the 2011/12 to 2015/16 fiscal years, and the 2012 to 2015 tax years respectively.

BusinessTech identified 10 important statistics from the report:

• The Tax-to-GDP ratio increased from 25.5% in 2014/15 to 26.2% in 2015/16, slightly below the peak of 26.4% achieved in 2007/08.

• Revenue growth was mainly supported by personal income tax (PIT), which grew by R35.4 billion (10%).

• The cost of revenue collection ratio decreased from 0.97% in 2014/15 to 0.96%, well within the international benchmark of 1%.

• Of the 6 662 490 individual taxpayers expected to submit returns for the 2014/15 tax year, 4 788 334 (71.9%) have been assessed.

• A demographic and geographic analysis shows that 1 920 874 (40.1%) assessed taxpayers were registered in Gauteng.

• A demographic and geographic analysis shows that 607 092 assessed taxpayers lived in the Johannesburg Metro and were taxed on an average taxable income of R404 430.

• VAT remained the second largest contributor to total tax revenue for 2015/16, totaling R281.1 billion (26.3% of total tax revenues).

• The main sectors that contributed to domestic VAT growth were financial intermediation, insurance, real-estate & business services; community social & personal services; and construction.

• At 18.1% of total tax revenues, Company Income Tax (CIT) was the third largest contributor to total tax revenue collected in 2015/16.

• Import VAT and Customs Duties, South Africa’s two biggest trade-related taxes, jointly contributed R197 billion (18.4%) to total tax revenue collected in 2015/16.

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