TAX STATISTICS 2018
National Treasury and the South African Revenue Service have published the 11th annual edition of the Tax Statistics.
The 2018 edition provides an overview of tax revenue collections and tax return information for the 2014 to 2017 tax years, as well as the 2013/14 to 2017/18 fiscal years.
In 2017/18, for the first time since the 2008 global financial crisis, tax revenue growth did not exceed GDP growth. Key points in the 2018 edition are:
Tax revenue collected amounted to R1 216.5 billion, growing year-on-year by R72.4 billion (6.3%) mainly supported by Personal Income Tax, which grew by R37.0 billion (8.7%):
o Personal Income Tax (PIT) at 38.1%, Corporate Income Tax (CIT) at 18.1% and Value-added Tax (VAT) at 24.5% in aggregate remain the largest sources of tax revenue and comprise about 80.7% of total tax revenue collections.
o Despite tough economic conditions in which real and nominal GDP increased by a modest 1.3% and 7.0% respectively, the Tax-to-GDP ratio decreased marginally from 25.9% in 2016/17 to 25.8% in 2017/18.
In Chapter 2: PIT, geographic and demographic analysis of the assessments of the taxpayers who had been assessed as at the end of June 2018 showed some interesting results:
o 2 678 743 (54.7%) of assessed taxpayers were male taxpayers; 2 219 822 (45.3%) were female.
o 1 331 419 (27.2%) of assessed taxpayers were aged 35 to 44 years; and
o 1 966 744 (40.1%) of assessed taxpayers were registered in Gauteng, of which 629 113 lived in the Johannesburg Metro and were taxed on an average taxable income of R446 838.
Statistics in Chapter 3 regarding CIT reveal that just over 24.2% of the 768 687 companies assessed as at 30 June 2018 for tax year 2016 had positive taxable income. A further 48.3% had taxable income equal to zero and the remaining 27.4% reported an assessed loss;
Net VAT collections totalled R298.0 billion and grew by R8.8 billion (3.1%) compared to the previous year. Domestic VAT, which amounted to R336.3 billion and grew by R14.8 billion (4.6%), was the key driver for the aggregate growth in net VAT. Import VAT collections totalled R152.8 billion and grew year-on-year by R3.5 billion (2.4%). VAT refunds totalled R191.1 billion and grew by R9.5 billion (5.2%).
Chapter 4 indicates that in 2017/18, 76% of active VAT vendors were companies or close corporations. They contributed 92.0% to Domestic VAT payments and accounted for 89.8% of VAT refunds. Although individuals (sole proprietors) comprised 18.4% of VAT vendors, they contributed 3.1% of Domestic VAT payments and received 1.5% of VAT refunds.
After experiencing a decline in collections in 2016/17, Import VAT and Customs Duties showed some recovery in 2017/18, as detailed in Chapter 5. They accounted for 12.6% and 4.0% of the year’s Total Tax Revenue respectively, resulting in a 16.6% aggregate, which was below the 18.3% average over the preceding five years. The share of these taxes to GDP also shrunk to 4.2% from the preceding five-year average of 4.6%, with Import VAT recording 3.2% and Customs Duties at 1.0% for 2017/18.
o Import VAT from the top 3 contributing economic sectors made up 88.0% of the total, namely the Wholesale and Retail Trade, Catering and Accommodation sector (Tertiary) at 39.6%, followed by Manufacturing (Secondary) at 30.2% and Financial Intermediation, Insurance, Real-Estate and Business Services (Tertiary) at 18.1%.
o The overall effective Customs Duty rate in 2017/18 was 3.2% compared to previous year’s 3.0%. Key commodities with the highest effective Duty rates were Footwear and Accessories at 22.9%; Hides, Skins and Leather at 18.0%; Textiles and Clothing at 16.0%; Food, Beverages and Tobacco at 11.8% as well as Vehicles, Aircraft and Vessels at 8.2%.
Finally, Chapter 6: Other Taxes and Collections provide information about taxes such as Capital Gains Tax (CGT), Transfer Duty, Mineral and Petroleum Resources Royalty (MPRR), Southern African Customs Union (SACU) payments and Diesel refunds. In 2017/18, CGT of R17.6 billion was raised of which R10.0 billion was attributable to individuals and trusts and R7.6 billion to companies. This shows a narrow increase of R0.6 billion (3.3%) on the R17.1 billion raised in 2016/17. An aggregate of R124.8 billion has been raised since the introduction of CGT in October 2001.