A United Democratic Movement-led government will increase corporate tax by three percent, UDM leader Bantu Holomisa said on Sunday.
“A UDM government will change this tax system that favours the rich and the corporate sectors at the expense of the poor,” he told supporters at a UDM elections rally in Marikana, near Rustenburg in the North West.
“We will increase the corporate income tax rate from the current 28% to 31%, which will give us the resources we require for the service delivery needs of our people,” he said.
“Some will argue that increasing the corporate income tax rate will chase investors away. I put it to you that keeping it at 28% has not served as an incentive for foreign direct investment either. Instead, it has resulted in the corporate sector using sophisticated tax avoidance schemes to reduce their tax contribution to the fiscus even more. A UDM government will tighten laws on tax avoidance.”
He said that according to the 2019/20 national budget, personal income tax would contribute R552.9 billion to the fiscus, Value Added Tax (VAT) would contribute R360 billion, and corporate income tax would contribute R229 billion.
A UDM government would reduce VAT from the current 15% to 14%, and consider reducing it even further in future to protect the poor, Holomisa said.
– African News Agency (ANA)