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Johannesburg - An additional 5% or 10% levy on alcohol is inevitable and could be included in this year’s budget.
Gerard Soverall, head of indirect taxation at PricewaterhouseCoopers (PwC) in Gauteng said companies like SABMiller [JSE:SAB] were very concerned about the impact of this levy on their operations.
On Tuesday PwC peered into its crystal ball to speculate on possible announcements in Finance Minister Pravin Gordhan’s budget speech next week.
The company’s head of taxation, Paul de Chalain, said the question was whether the possible alcohol levy was aimed at combating alcohol abuse or generating revenue.
There were far more effective ways to combat alcohol abuse than through tax, he added.
Two years ago Botswana had introduced such a levy of 30%, causing somewhat of an uproar.
Soverall said taxpayers reach a point at which they simply refuse to pay more tax, which is when they rebel.
He declined to say how far he thought South African taxpayers were from this point.
The basic principles of taxation, he said, were that it should be fair, that is could be collected cost-effectively and that it should be at a level that people were prepared to pay.
Gordhan is to deliver his budget speech in parliament next Wednesday.
- Sake24
For business news in Afrikaans, go to www.sake24.com.
Gerard Soverall, head of indirect taxation at PricewaterhouseCoopers (PwC) in Gauteng said companies like SABMiller [JSE:SAB] were very concerned about the impact of this levy on their operations.
On Tuesday PwC peered into its crystal ball to speculate on possible announcements in Finance Minister Pravin Gordhan’s budget speech next week.
The company’s head of taxation, Paul de Chalain, said the question was whether the possible alcohol levy was aimed at combating alcohol abuse or generating revenue.
There were far more effective ways to combat alcohol abuse than through tax, he added.
Two years ago Botswana had introduced such a levy of 30%, causing somewhat of an uproar.
Soverall said taxpayers reach a point at which they simply refuse to pay more tax, which is when they rebel.
He declined to say how far he thought South African taxpayers were from this point.
The basic principles of taxation, he said, were that it should be fair, that is could be collected cost-effectively and that it should be at a level that people were prepared to pay.
Gordhan is to deliver his budget speech in parliament next Wednesday.
- Sake24
For business news in Afrikaans, go to www.sake24.com.
