2022 Budget speech update

Finance Minister Enoch Godongwana delivered his maiden Budget speech on Wednesday, 23 February. He noted that although the easing of COVID-19-related restrictions supported a return to economic growth in 2021, the country is still under financial pressure and dealing with the effects of the pandemic, rising inflation, increased fuel prices and a series of interest rate increases. The Minister acknowledged that now is therefore not the time to increase taxes, which would put the economic recovery at risk. The theme of this year’s Budget is “keeping money in the pockets of South Africans”.

Gross tax revenue for 2021/2022 is expected to be R181.9 billion higher than projections in the 2021 Budget and R61.7 billion higher than projected in the 2021 Medium-Term Budget Policy Statement. Corporate income tax collections from mining account for most of this surplus, with personal income tax collections and VAT also performing above expectations. For the past two years, the focus has been on broadening the tax base, improving administration, and lowering tax rates. Government intends to continue with this approach while avoiding tax rate increases as far as possible. Implementation of structural reforms will contribute to economic recovery and improved tax collection.

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February 28 2022 By Carrie Norden - Allan Gray