#Budget2018

85% of VAT is collected from the top wealthiest people - Sars

Sars Group Executive: Tax Excise & customs Institute, Dr Randall Carolis says while there are more pragmatic reasons why the Value Added Tax (VAT) is the focus of this year's budget speech, it is easier to collect.

VAT will go up from 14 to 15%, a move Finance Minister Malusi Gigaba says will have the least impact on the economy.

A 52 cents a litre fuel levy increase has been included, as well as other tax hikes expected to bring an extra R36 billion in revenue this year.

Carolis explains further on why VAT is the more plausible option.

It is sort of self-regulatory internally. What you put in for a VAT claim somebody else pays and it is quite easy to follow that train.

Dr Randall Carolis, Sars Group Executive: Tax Excise & customs Institute

But I would think the other taxes have been exhausted. Cooperate tax we cannot really touch because our trading partners are all revising it down so we had to go along the VAT route.

Dr Randall Carolis, Sars Group Executive: Tax Excise & customs Institute

But the VAT also, if you look at it carefully, there is zero rating for poor people or the consumption of poor people.

Dr Randall Carolis, Sars Group Executive: Tax Excise & customs Institute

Interesting statistic that many people don't know is that we collect 85% of the VAT from the top 30 wealthiest people so in that way there is some form of aggressiveness in it.

Dr Randall Carolis, SARS Group Executive: Tax Excise & customs Institute

Carolis is confident that Sars will meet it's set target.

Click on the link below to hear more from Carolis...


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