Tariff Uncertainty
The US has announced sweeping tariffs on imports.
How were the tariffs calculated?
They are based on the size of the US’s trade deficit with each country, calculated as a percentage of total trade and then halved. The rationale of this formula has been criticized by those who believe there is no economic justification.
Some Key Points From South Africa’s 2025 Budget…
• VAT Increase:
The budget includes a 0.5% increase in the Value Added Tax (VAT) rate, with a potential further increase of 0.5% in 2026.
• Economic Growth:
The country’s growth is estimated to reach 0.90% for 2025, while the Budget assumes a growth rate 1.90% for 2026.
• Spending Priorities:
Key spending areas include Learning and Culture (Education), Social Development (Grants and Welfare), Health Services, Community Development (Infrastructure & Housing), and Economic Development (Job Creation & Innovation).
• Retirement Fund Proposals:
The two-pot system for retirement funds remains in place, with no changes to the ability of members to access their retirement component until retirement.
• Personal Income Tax:
Personal income tax brackets and rebates will not be adjusted for inflation in 2025/26.
Note: South Africa’s 2025 budget is still subject to parliamentary approval and potential amendments.