PARLIAMENT - South African finance minister Malusi Gigaba announced on Wednesday that the fuel levy would be increasing by more than 50 cents per litre from 4 April 2018 and that "sin tax" would be hiked by up to 10 percent.
Gigaba's Budget Review said that government proposes to increase excise duties on tobacco products by 8.5 percent and excise duties on alcohol by between six and 10 percent.
"The main tax proposals for the 2018 Budget are a 52 cents per litre increase in the levies on fuel, made up of a 22 cents per litre for the general fuel levy and a 30 cents per litre increase in the Road Accident Fund Levy, and a increase in the alcohol and tobacco excise duties of between six and 10 percent," Gigaba said in his speech in Parliament.
"In developing these tax proposals, government reviewed the potential contributions from the three major tax instruments which raise over 80 percent of our revenue; personal and corporate income tax, and VAT."
Gigaba announced a combination of tax proposals designed to generate R36 billion in additional tax revenue for the 2018/19 financial year as government has reviewed its r evenue shortfall from R50.2 billion to R48.2 billion.
The Budget Review said that tax revenue for 2017/18 were expected to marginally outperform projections set out in the 2017 Medium Term Budget Policy Statement in October, but additional measures were required to stabilise the pubic finances.
- African News Agency (ANA)