All thoughts turn to tax
18 February 2013
Posted by: SAIT Technical
By FIN 24
The Budget Speech is set to take place on 27 February, less than 24 hours before the end of the current tax year. Any tax changes announced in the speech will thus come into effect a mere two days after the speech.An increase in the marginal tax rate applicable to the highest income earners might be on the cards.
Cape Town - With President Jacob Zuma's State of the Nation address done and dusted, the focus now turns to the Budget speech by Finance Minister Pravin Gordhan.
This year the all important Budget speech is set to take place on February 27, later than usual and less than 24 hours before the end of the current tax year. Any tax changes announced in the speech will thus come into effect a mere two days after Gordhan's speech.
"Once again, a super tax on the wealthy is being mooted” especially in light of income and inequality disparities highlighted in the census, according to Marteen Michau, head of fiduciary and tax at Sanlam Private Investments.
The funds are largely expected to then be filtered down to addressing poverty and inequality.
Michau said that "some sort of increase in taxation of the wealthy seems inevitable”.
"This might take the form of an increase in the inclusion rate for capital gains tax; alternatively, an increase in the marginal tax rate applicable to the highest income earners might be on the cards.”
The speech is also widely expected to touch on issues such as mining taxes, how a national health insurance system might be funded, the implementation of toll roads and social security taxes.
Certain retirement tax reforms have been talked about, said Michau, although mostly for implementation in 2014.
The window period for taking residential properties out of South African trusts and companies without tax liability (if certain requirements were met), had also just come to an end.
Meanwhile, Michau also signalled a reminder to taxpayers to gather any outstanding documentation and have any meetings that might help to manage their tax planning ahead of the month-end deadline.