2024 National Budget Highlights
No increases to corporate tax, income tax, capital gains tax, or VAT.
No changes to fuel levy and road accident levy.
Increase in excise duties on alcohol and tobacco
Duties on alcohol will increase between 6.7% and 7.2%, while duties on tobacco products will increase between 4.7% and 8.2%.
No inflation adjustments to the personal income tax tables and medical tax credits
The fact that personal income tax brackets remain the same as in 2023 will however lead to low- to middle-income earners, who received a salary increase during the 2024/2025 tax year, paying more tax or even being pushed to a higher tax bracket.
Two-pot retirement system set for implementation on 1 September 2024
The two-pot system determines that all contributions to retirement funds will be split into two components: one-third going into a “savings component” pot and two-thirds going into a “retirement component” pot. The idea behind the two-pot system is to promote the preservation of retirement fund savings until retirement, whilst allowing investors access to savings in times of need.
Global minimum corporate tax to be implemented
South Africa will impose a global minimum corporate tax of 15% from 1 January 2025, joining 54 other countries in doing so. All multinational corporations with an annual revenue exceeding €750-million will be subject to an effective tax rate of at least 15%, regardless of where the company’s profits are located.
The proposed reform is expected to yield an additional R8-billion in corporate tax revenue in the 2026/27 financial year.
If you are interested in more information about the 2024 National Budget, please refer to the resources listed below:
1) Sanlam Update – South Africa’s 2024 National Budget Speech