The March 2025 Budget Review outlined tax proposals for 2025/26 and 2026/27. Except as otherwise indicated below, these proposals stand unchanged, including for personal income tax, transfer duties and excise duties. The main policy changes are the withdrawal of the proposed VAT rate increases, alongside the withdrawal of additional zero-rated items, and a proposed inflation-related increase in the fuel levy.
The South African 2025 Budget Review introduces several significant tax proposals aimed at addressing fiscal challenges, promoting economic growth, and supporting vulnerable households. A notable proposal is the increase in the value-added tax (VAT) rate by 2 percentage points to 17 percent, effective from April 1, 2025, expected to raise substantial additional revenue. To mitigate the impact on low-income households, the government plans to expand the list of VAT zero-rated essential food items.
