{"id":755753,"date":"2024-02-28T12:30:00","date_gmt":"2024-02-28T10:30:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=755753"},"modified":"2024-02-28T12:15:10","modified_gmt":"2024-02-28T10:15:10","slug":"take-home-pay-increases-in-south-africa-but-storm-clouds-are-gathering","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/755753\/take-home-pay-increases-in-south-africa-but-storm-clouds-are-gathering\/","title":{"rendered":"Take-home pay increases in South Africa – but storm clouds are gathering"},"content":{"rendered":"\n

The BankservAfrica Take-home Pay Index (BTPI) has continued to increase, but there are dangers for tax-paying South Africans. <\/p>\n\n\n\n

\u201cThe nominal average take-home pay was R15,670 in January, representing a 9.1% year-on-year increase \u2013 off the low base \u2013 and showed a 1.5% growth on the R15,533 recorded in December,\u201d said Shergeran Naidoo, BankservAfrica\u2019s Head of Stakeholder Engagements.<\/p>\n\n\n\n

Real take-home pay increased by 3.5% year-on-year to R13,968 in January 2024, suggesting that the significant decline in purchasing power during 2023 is starting to ease. <\/p>\n\n\n

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Source: BankservAfrica <\/figcaption><\/figure><\/div>\n\n\n

Nevertheless, Finance Minister Enoch Godongwana’s decision not to adjust income tax brackets for inflation may cause financial challenges. <\/p>\n\n\n\n

\u201cThis essentially means that a salary increase could push salary earners into a higher income tax bracket. Affected individuals could end up paying tax at a higher rate \u2013 and take home a lower salary than before the increase,\u201d said Elize Kruger, Independent Economist.<\/p>\n\n\n\n

“Bracket creep” will see the government earn more than R16.3 billion in taxes in the 2024\/25 financial year. <\/p>\n\n\n\n

The government looks set to keep “bracket creep” around for at least three years as part of its medium-term policy, which could take away R52.2 billion from the pockets of tax-paying salary earners over the period.<\/p>\n\n\n\n

Although headline CPI moderated from 6.9% in January 2023 to 5.3% in January 2024, a few upside risks have appeared in the first few weeks of 2024. <\/p>\n\n\n\n

The rand weakened from R18.35\/$ at the start of the year to roughly R19.30\/$ in the last few weeks. <\/p>\n\n\n\n

This is expected to add upside risks to inflation, as imports and globally priced products, such as fuel, will see price increases. <\/p>\n\n\n\n

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Positive turn for petrol prices in South Africa – but the pressure is on<\/a><\/blockquote>