Taxpayers, except those in the lowest tax bracket, will see a slight dent in their pay packets from April 1, Finance Minister Nhlanhla Nene announced on Wednesday.
“Personal income tax rates will be raised by one percentage point for all taxpayers earning more than R181,900 a year,” Nene said in presenting his first main budget to the National Assembly.
“This raises tax by R21 a month for a taxpayer below the age of 65 with an annual income of R200,000. Those earning R500,000 would pay R271 a month more, and at R1.5 million a year the tax increase is R1105 a month.”
Tax brackets, rebates an medical schemes, and medical aid contributions would however be adjusted for inflation.
“The net effect is that there will be tax relief below about R450,000 a year, while those with higher incomes will pay more in tax,” said Nene.
The tax-free threshold for individuals would increase from R70,700 to R73,650.