Amid new e-toll tariffs, electricity price hikes and a potential fuel price increase, many South Africans are beginning to feel financially overwhelmed.<\/p>\n
There is a perception that South African’s are overburdened when it comes to paying tax, especially after Finance Minister Nhlanhla Nene\u00a0increased taxes on personal incomes for the first time in twenty years.<\/p>\n
Data from KPMG which ranks the countries with the highest personal income tax, found that South Africa features among\u00a0the top 50 highest income tax paying nations in the world.<\/p>\n
With a peak income tax of 41%, the country ranks as the 31st\u00a0highest tax-paying nation in terms of individual tax.<\/p>\n
Previously, the country tied with Chile, Croatia and Uganda in 32nd\u00a0position with a maximum tax rate of 40%.<\/p>\n
In the 2016 tax year (1 March 2015 – 29 February 2016), South Africa’s highest tax rate increased to 41% for individuals earning over R701,301. All South African tax brackets have a base payment, with the percentage applying to the amount over that.<\/p>\n
The data from KPMG looks at the highest possible personal income tax in the country, discounting the various tax brackets and conditions required to hit that level.<\/p>\n
For example, in South Africa those earning below R70,700 per annum do not get taxed (R73 650, in 2016), while the entry bracket of 26% applies to those earning over R181,900.<\/p>\n
According to a quarterly Labour Market Report by Solidarity, published earlier this week, only 3.3 million out of a total 33 million eligible tax payers in the country pay 93% of all personal income tax.<\/p>\n
Worse still, only 3.7%\u00a0\u2013\u00a0or 1.1 million people \u2013 pay just short of 70% of the total income tax received.<\/p>\n
These are the South African tax brackets for 2016:<\/p>\n
\u200bTaxable income<\/strong><\/td>\n| Rates of tax<\/strong><\/td>\n<\/tr>\n | \u200b0 – R181 900<\/td>\n | 18% of each R1.00<\/td>\n<\/tr>\n | R\u200b181 901 – R284 100<\/td>\n | R32 742 + 26% of the amount above R181 900<\/td>\n<\/tr>\n | R\u200b284 101 – R393 200<\/td>\n | R\u200b59 314 + 31% of the amount above R284 100<\/td>\n<\/tr>\n | R\u200b393 201 – R550 100<\/td>\n | R 93 135 + 36% of the amount above R393 200<\/td>\n<\/tr>\n | R\u200b550 101 – R701 300<\/td>\n | R149 619 + 39% of the amount above R550 100<\/td>\n<\/tr>\n | R701 301 and above<\/td>\n | R208 587 + 41% of the amount above R701 300<\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n | Highest tax payers<\/h3>\nKPMG lists Aruba as the highest individual taxer, with a maximum tax rate of 58.95%<\/p>\n Aruba’s tax applies for people earning the equivalent of R1.9 million or more, after tax-free income has been deducted.<\/p>\n Other high-tax nations include Sweden (57% for those earning over R890,000), Denmark (55% for those earning R850,900 and more) and the Netherlands and Spain (52% on income over R800,000 and R4.1 million, respectively).<\/p>\n Countries with the lowest tax rate include many nations such as Saudi Arabia, Kuwait, Anguilla which do not tax income.<\/p>\n Sweden’s tax collection agency is one of the most popular and most trusted organizations in the country – notably because it works efficiently and contributes meaningfully to Swedish society.<\/p>\n 20 highest tax-paying nations<\/h3>\n
|