Many taxpayers received an early Christmas bonus in October from the South African Revenue Service (SARS), which kept to its word of accelerating refunds. This was shown in the monthly Treasury report on South Africa’s fiscal balance and had been flagged in October’s Medium Term Budget Policy Statement (MTBPS).
Personal Income Tax (PIT) refunds jumped to R4.9bn in October 2018 from R2.8bn in October 2017, while Value Added Tax (VAT) refunds soared to ZAR23.8bn from ZAR15.8bn.
If the refunds had remained the same as their October 2017 values, in other words, if the “additional” R10.1bn in refunds had not taken place, then revenue growth would have been 19.3% year-on-year (y/y) under “ceteris paribus” assumptions instead of the actual 5.7% y/y that was reported for October 2018.
This is also reflected in the gross PIT and VAT collections as Pay-As-You-Earn collections grew by 8.5% y/y, domestic VAT collections by 11.2% and import VAT collections by 24.1%.
This contribution to Finance Friday was made by
Forecaster Ecosa cc
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