Here are the taxes you probably didn’t know you were paying in South Africa
The South African Revenue Service (SARS) has released its tax statistics for 2021, providing a breakdown of tax revenue in South Africa at present.
While corporate and income taxes are well documented, the report also provides insight into some of the “under the radar” taxes that South Africans currently pay.
The tire tax was introduced on October 1, 2016 at a rate of R2.30/kg due to the disposal of tires that pollute the environment.
New tires are subject to the payment of tire tax (an environmental tax) if used in South Africa, which is payable by manufacturers in South Africa. The fee is calculated on the net mass of the tyre.
Tax on plastic bags
The plastic bag tax was introduced in June 2004, at a rate of 3 cents per bag on certain types of plastic bags, with the aim of reducing waste and encouraging the reuse of plastic bags.
The levy was increased to 4 cents per bag from April 1, 2009, 6 cents per bag from April 1, 2013, 8 cents per bag from April 1, 2016, 12 cents per bag from April 1, 2018 and further increased to 25 cents per bag from April 1, 2020.
Tax on incandescent bulbs
The incandescent bulb charge was introduced on 1 November 2009 at the rate of R3 per bulb, to promote energy efficiency and reduce demand for electricity by encouraging the use of energy saving bulbs .
Energy-saving bulbs last longer and consume less electricity. The use of these bulbs thus makes it possible to reduce “greenhouse gas” emissions.
The levy increased to R4 per bulb from April 1, 2013, R6 per bulb from April 1, 2016, R8 per bulb from April 1, 2018 and again R10 per bulb from April 1, 2020.
CO2 tax on motor vehicle emissions
A CO2 tax on motor vehicle emissions was introduced in September 2010 for passenger vehicles and in March 2011 for double cab vehicles.
The main purpose of this levy is to encourage motor vehicle owners in South Africa to become more energy efficient and environmentally friendly.
From 1 April 2020 the threshold was adjusted from 120 gCO2/km to 95 gCO2/km for passenger cars and emission tax rates increased to R120 per gCO2/km for passenger cars and R160 R gCO2/km for double cabins.
The Health Promotion Tax was introduced on April 1, 2018. It is a tax imposed on sugary drinks in support of Ministry of Health deliverables to reduce diabetes, obesity and other lifestyle diseases in South Africa.
The health promotion tax applies to beverages containing more than 4 grams of sugar per 100 ml. The levy is payable by the manufacturers of these products in the Republic of South Africa (RSA), as an internal consumption tax, and is therefore not payable on sugar-sweetened beverages which are exported or processed in the manufacture of other products dutiable.
It is payable on sugar-sweetened beverages manufactured or imported into South Africa.
The carbon tax (CBT) is a new tax in response to climate change, which aims to reduce greenhouse gas (GHG) emissions in a sustainable, cost-effective and affordable way.
The carbon tax gives effect to the polluter pays principle and helps to ensure that businesses and consumers take into account the negative negative costs (externalities) of climate change in their future production, consumption and investment decisions.
The first phase has a carbon tax rate of R120 per tonne of carbon dioxide equivalent emissions. This rate will increase annually with inflation plus 2% until 2022, and annually with inflation thereafter.
Large industry-specific tax-free emissions allowances ranging from 60% to 95% will result in a modest net carbon tax rate ranging from R6 to R48 per tonne of carbon dioxide equivalent emissions to give current issuers the time to transition their operations to cleaner technologies through investments in energy efficiency, renewable energy and other low-carbon measures.
Read: South Africa has released updated tax ‘rules’ – what you need to know