Welcome relief for individual taxpayers

Revenue collections for 2021/22 reached approximately R1,55 trillion, beating projections by 24%. To encourage economic stabilisation the Minister of Finance announced in the 2022 Budget Speech that South African individual taxpayers would benefit from R5,2 billion worth of tax relief, through a 4,5% upward adjustment to the personal income tax brackets, income tax rebates and thresholds.

24 Feb 2022 1 min read 2022 Special Edition Budget Speech Alert Article

The upward adjustment of personal income tax brackets has avoided a phenomenon known as “bracket creep”. This occurs where not adjusting the income tax brackets leads to higher tax collected due to inflationary increases in people’s income, as people either move into higher brackets or earn more above the taxing threshold in their current bracket.

The personal income brackets for the 2022/23 tax year are as follows:

10712 ALERT_Budget day_TABLE

The income tax rebates have been increased to the following amounts:

Primary: R16,425
Secondary: R9,000
Tertiary: R2,997

The income tax thresholds are as follows:

Below age 65: R91,250
Age 65 to 75: R141,250
Age 75 and over: R157,900

Added disposable income in the hands of South African consumers is essential for economic growth, especially following the income constraints faced from the COVID-19 pandemic. The tax relief provided in the 2022 Budget Speech is therefore a welcome decrease in the burden South African individual taxpayers must bear.

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