(Photo: iStock) ~ iStock
Finance Minister Tito Mboweni may not have announced any increases in income or corporate tax rates in his maiden Budget, but as in previous years sin taxes – the taxes government levies on alcohol and tobacco - will again rise at above-inflation rates.
The increase in the excise duties are expected to bring in an additional R1bn in revenue, which includes R400m from tobacco products and R600m from alcohol. These form part of R15bn in additional revenue announced by the finance minister. Changes to excise duties announced by Mboweni include:
- Beer drinkers will pay 12 cents more for a 340ml can, bringing total excise duties to R1.73.
- Duties on traditional African, or sorghum beer and beer powders have remained unchanged.
- A 750ml bottle of wine will cost 22 cents more, with total taxes at R3.15.
- Sparkling wine is going up by 84 cents per 750ml bottle to R10.16.
- Excise duties on a bottle of whisky (and other spirits) will increase by R4.54 to R65.84 per bottle.
- A pack of 20 cigarettes will go up by R1.14 to R16.66.
Income tax brackets to remain unchanged
Income tax brackets will not be increased in line with inflation, Mboweni, announced, meaning that more individuals may fall into a higher bracket if they receive salary increases. Treasury says this is expected to raise an additional R12.8bn in revenue, which makes up the lion's share of the additional revenue announced in Mboweni's maiden Budget.
Rebates and the tax threshold will be nudged up to allow a "small amount of relief for inflation".The tax free threshold has been upped from R78 150 to R79 000.