Big tax increases looming

Big tax increases looming

South Africans can expect to fork out more for taxes next year, as the country's economy continues to struggle amid lower revenue collection. 

South African money
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Finance minister Pravin Gordhan tabled his medium term budget in Parliament this afternoon. 

READ ALSO: Key points of Gordhan's 2016 medium term budget

Chief economist at Econometrix Dr Azaar Jarmine says: "People must expect significant tax increases next year. We don't know whether it will be personal tax, VAT or a combination - which is most likely."

Despite the tough economic times, Treasury has allocated R17 billion more for universities and students.

"What we seek and more can be done if we collectively make the right choices, support confidence and investment in our economy, create a predictable and stable policy and political environment and put the national interest first," Gordhan said.

The country's economic growth outlook had been revised downwards to 0.5% from 0.9%, he announced. 

READ ALSO: Gordhan delivers 2016 medium term budget

The economy is forecast to grow to 1.3% next year, 2% in 2018 and 2.2% in 2019

"It is not just that our economic outlook is distressed and there is the possibility of a downgrade by rating agencies, the rising cost of debt, it is not just the most severe drought that has struck us in decades - much more disturbing and more difficult is the rise of our own communities and their voices of anger, disappointment perhaps and discontent," Gordhan pointed out. 

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