Johannesburg - The Treasury yesterday cut R3 billion off its estimate of tax revenue to R895bn in the 2013/14 tax year. However the medium-term budget policy statement said tax collection “has shown resilience” despite lower-than-expected growth.
“Personal income tax collection remains strong as a result of high wage settlements and corporate income tax has been robust. Taxes on imported goods have been buoyant. The revised estimate for corporate income tax revenue is virtually unchanged but there is a degree of uncertainty about the second half of the year.”
Slower economic growth is, however, reflected in disappointing domestic VAT and excise duties, which point to “reduced consumer demand and weaker income tax collection over the medium term”.
It said the sharp depreciation of the rand “is unlikely to result in a sustained surge in company profits as cost pressures increase and trade contracts are adjusted”. – Ethel Hazelhurst