Insights
The South African Budget Speech 2025
Introduction
Following a delay of three weeks, South African Minister of Finance, Enoch Godongwana, finally delivered his 2025 Budget Speech on the 12th of March 2025. This speech was originally scheduled for the 19th of February 2025 but was postponed at the last minute because of objection from members of Government on a proposed increase of 2 percentage points in the VAT rate to 17 percent.
The compromise reached on the originally planned 2 percentage points increase in VAT was:
- A 0.5 percentage point increase in the VAT rate to 15.5 percent effective from 1 May 2025.
- A further 0.5 percentage point increase in the VAT rate to 16 percent effective from 1 April 2026.
- No inflationary adjustments to personal income tax brackets, rebates and medical credits.
As has been the custom for the last number of years, the largest part of the budget speech did not deal with tax issues but rather various social and funding issues that South Africans are well familiar with.
Download the summary from our Tax Advisory Team in South Africa.
Disclaimer
This document has been prepared for information only. Draft laws and regulations contained herein are subject to change and may differ from the final version. Accordingly, this document may not be relied upon as a statement of the law or regulatory requirements, or as an indication of policy. No information provided herein may in any way be construed as advice. Professional advice must be sought before any action is taken based on the information provided herein. The distribution or possession of this document in certain jurisdictions may be restricted by law or other regulatory requirements. Persons into whose possession this document comes should inform themselves about and observe any applicable legal and regulatory requirements in relation to the distribution into, or possession of this information, in that jurisdiction. This document has been approved for issue in South Africa by Stonehage Fleming Financial Services (Pty) Ltd, an authorised Financial Services Provider (FSP No. 9587). © Copyright Stonehage Fleming 2025. All rights reserved.