Finance Minister, Malusi Gigaba Photo: Phandulwazi Jikelo

CAPE TOWN - As Finance Minister Malusi Gigaba delivered his maiden National Budget for the 2018/19 financial year, the South African banking sector shared their sentiments regarding potential changes to the countries tax landscape.

Kwaku Koranteng the acting head of Absa Asset Consulting says "While there have been talks of VAT increases prior to the Budget speech as presented by the Finance Minister today, the across the board rise to 15 percent on all goods and services is somewhat of a surprise, but arguably the most effective way of raising revenue. It does mean however that general inflation will increase and the average consumers’ pockets will be hit the hardest".

Koranteng added that the VAT increase has an unpopular social element given that it has a bigger impact on the lower to middle-income market, while at the same time our VAT rate is below the global average, therefore the increase is somewhat justifiable in addressing the fiscal gap.

Min. Gigaba moves on to address Tax saying; “Tax policy proposals are designed to raise R36 billion in additional tax revenue for 2018/19.” #Budget2018

— Standard Bank SA (@StandardBankZA) February 21, 2018

There you have it folks – we’re going to fork out a little bit extra on tax this year. ❤️ if you expected this. #Budget2018

— Absa (@Absa) February 21, 2018

For the first time since 1993 VAT has been increased from 14% to 15%. That basically means everything is going to cost more. RT if you saw this coming. #Budget2018

— Absa (@Absa) February 21, 2018

#Gigaba: Increases in the alcohol and tobacco excise duties of between 6 and 10 per cent. #Budget2018

— Capitec Bank (@CapitecBankSA) February 21, 2018

Impact of VAT hike on the poor to be partially mitigated by ‘zero rating of basic food items, paraffin & above inflation increases in social grants’ #Budget2018

— Nedbank (@Nedbank) February 21, 2018

It’s the first time since 1993 that VAT has been increased. #Budget2018

— Nedbank (@Nedbank) February 21, 2018

Sin taxes hiked again. Increases of between 6 and 10% on alcohol and tobacco excise duties. #Budget2018

— Nedbank (@Nedbank) February 21, 2018

Increases to various environmental levies including plastic bags and lightbulbs as well as the imminent introduction of the Carbon Tax legislation shows government’s commitment to the environment.#FNBBudgetPlanning #BudgetSpeech2018

— FNB South Africa (@FNBSA) February 21, 2018

Gigaba: No income/corporate tax hikes. Recent adjustments to income tax have been significant. Corporate tax is high by international standards. VAT has not been increased in the past 25 years.#FNBBudgetPlanning #BudgetSpeech2018

— FNB South Africa (@FNBSA) February 21, 2018

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