CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. South Africa Targeting Double-Digit Revenue Growth

South Africa Targeting Double-Digit Revenue Growth

by Lorys Charalambous,, Cyprus

15 July 2014

The South African Revenue Service (SARS) is targeting revenue growth exceeding ten percent over the medium term, despite a sluggish economy and a falling budget this year.

SARS hopes to secure revenue growth of 10.4 percent during 2014/15, despite a one percent reduction in its budget, it told Parliament's Standing Committee on Finance, presenting its five-year strategic plan and annual performance plan for 2014/15. Half of this growth will be due to inflation, estimated to hover at about five percent over the next three fiscal years, but the remainder will be generated from enforcement activities and the recent introduction of value-added tax on foreign suppliers of electronic services, under a new framework that became effective in June. This revenue growth is marginally below trends since 1994/95 of 11.5 percent.

According to the presentation, the composition of revenues in South Africa has moved away from direct taxes. During the 2013/14 financial year, 20 percent of revenues came from corporate income tax (CIT), 35 percent from personal income tax (PIT), while value added tax (VAT) accounted for 26 percent of the tax base, and excise duty five percent. The marginal rate on corporate income has fallen from 40 percent in 1994/95 to 28 percent in 2012/13, while the marginal tax rate on personal income has remained largely stable, dropping from 43 percent to 40 percent.

In its presentation, SARS committed to boost revenue growth by improving compliance rates, including by building on public trust; responding to non-compliance early; increasing enforcement activities to interdict illicit trade; combating unacceptable avoidance; and enhancing collaboration with other government departments in tax matters.

Over the next five years, SARS will seek to leverage increased access to taxpayer information owing to international tax transparency developments; enhance the technical capability of staff; introduce the single registration of taxpayers across government; implement the Customs Bill and support World Trade Organization efforts to facilitate trade; and improve its management of complaints.

TAGS: South Africa | compliance | tax | business | value added tax (VAT) | tax compliance | tax avoidance | fiscal policy | law | World Trade Organisation (WTO) | corporation tax | enforcement | ministry of finance | tax authority | tax rates | revenue statistics | tax reform | standards | regulation | trade | individual income tax | Africa

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »