No tax rate increases, and no new taxes introduced – what is absent from the budget is the best and biggest news! 

Government is still pondering a wealth tax though, information is being gathered through third parties and this information will help the revenue authorities to assess the feasibility of a wealth tax.

Not only tax incentives, but also deductions for expenditure and assessed loss offsets will be reduced. Depending on how this is legislated it could have a huge negative impact on the bottomline of taxpayers. No use in having a lower rate applied to a much higher bottomline. 

Bad news for venture capitalists – the sunset date of 30 June 2021 for the Venture Capital tax benefits will not be extended.

Prospects of reduced corporate and individual tax rates (in future years) are interesting and promising. 

The corporate rate reduction to 27% has been confirmed for years commencing on or after 1 April 2022.

Further clamp-down on plans to transfer growth assets to trusts – "further changes" are promised. Will be interesting to see... There are so many rules in place already.

There are noises of future VAT rate increases - compared to peer countries, the SA VAT rate is low.

The economic double taxation arising from treating hybrid interest as dividends only for the payor, but not the recipient, will at last be addressed. 

Sin taxes up by 8%.

Written by Doelie Lessing, director & tax specialist at Werksmans Attorneys