Sars stats for 2022 shows who the country’s top taxpayers are

The Sars statistics for 2022 show who pay the most tax: individuals who pay personal income tax and VAT and corporates. Personal income tax contributes 35.5%, VAT 25.0% and corporate income tax 20.7%, comprising 81.2% of total tax revenue collections.

National Treasury and the South African Revenue Service (Sars) published the fifteenth annual edition of the Tax Statistics that provides an overview of tax revenue collections and tax return information for the 2018 to 2022 tax years, as well as the 2017/18 to 2021/22 fiscal years.

According to Sars, the economic recovery from the pandemic differs from previous negative shocks to the economy.

“After the 2008/09 global financial crisis, it took tax revenue collections several years to recover to pre-crisis levels as a proportion of income and consumption.

“The recovery in tax revenue was noticeable across all tax types, but especially for corporate income tax due to the escalation in commodity prices, as well as domestic taxes on goods and services, that were most affected by the lockdown measures induced by the pandemic.”

Total tax revenue collected by SARS increased from R1 216.5 billion in 2017/18 to R1 563.8 billion in 2021/22, growing at a compound annual growth rate of 6.5% over this time, which is significantly lower than the 8.4% in the previous five-year period from 2012/13 to 2017/18.

The tax-to-GDP ratio moderated from 23.8% in 2019/20 to 22.3% in 2020/21, followed by an increase to 24.9% in 2022.

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Personal income tax statistics

Sars says by 31 March 2021, the personal income tax register had grown by 4.1% on an annual basis to 23.9 million individuals. For the 2018 tax year, the number of individuals expected to submit income tax returns was 7.1 million, but this count decreased to 6.8 million for 2020 and then to 6.4 million for 2021, due to the increase in the threshold for submission of returns.

The population of taxpayers identified for auto-assessment in the 2020 filing season was significantly expanded to just more than 3.4 million.

For the 2021 tax year, assessed data for individual taxpayers indicated that, of the 6 388 532 taxpayers expected to submit returns, 5 508 525 (86.2%) taxpayers have been assessed.

Personal income tax, geographic, demographic and other analysis of the assessments of the taxpayers who had been assessed as at the end of August 2022 for the 2021 tax year showed these interesting results:

• 2 177 191 (39.5%) of assessed taxpayers were registered in Gauteng
• 726 663 assessed taxpayers lived in the Johannesburg Metro and were taxed on an average taxable income of R446 739
• 1 432 673 (26.0%) of assessed taxpayers were between the ages of 35 and 44
• 2 859 926 (51.9%) of assessed taxpayers were male
• 2 613 130 (47.4%) were female
• 35 469 (0.6%) taxpayers could not be identified in terms of gender
• Assessed taxpayers had a combined taxable income of R1.8 trillion and tax liability of R388.1 billion.
• The average tax rate was 21.4% compared to 22.3% the previous tax year and income from salaries, wages and other remuneration as well as pension, overtime and annuities accounted for 77.2% of total taxable income.

The tax statistics show that from the 1 028 832 companies assessed by August 2022 for tax year 2020, 21.4% declared a positive taxable income, while 53.2% had taxable income equal to zero and the remaining 25.4% reported an assessed loss.

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VAT and other taxes

In 2021/22, 80.0% of active VAT vendors were companies and close corporations, and they contributed 92.7% to domestic VAT payments and accounted for 91.9% of VAT refunds.

Although individuals (sole proprietors) comprised 14.8% of active VAT vendors, they only contributed 2.3% of domestic VAT payments and received just 1.2% of VAT refunds.

Import VAT accounted for 13.1% of the total tax revenue and customs duties for 3.7% of the year. The combined share of these taxes to GDP increased to 4.2% from the preceding five-year average of 4.0% with import VAT contributing 3.3% and customs duties 0.9%.

In the 2021/22 fiscal year import VAT was collected mostly from the import of machinery and electronics (25.6%), chemical products (14.2%), vehicles, aircraft and vessels (9.7%), special provisions (8.9%), base metals (7.5%), plastics and rubber (5.5%), textiles and clothing (5.0%) and mineral products (4.0%).

Vehicles, aircraft and vessels (22.7%), textiles and clothing (17.3%), food, beverages and tobacco (14.8%) and machinery and electronics (13.3%) were the largest contributors to customs duties in 2021/22.

Under other taxes and collections that include information about taxes, such as capital gains tax, transfer duty, mineral and petroleum resources royalty, Southern African customs union payments and diesel refunds, R16.2 billion was raised in capital gains tax, of which R7.7 billion was attributable to individuals and trusts and R8.5 billion to companies.

Mineral and petroleum resources royalty payments by extractors grew quite substantially by R14.2 billion (100.0%) to R28.5 billion thanks to a significant improvement in commodity prices, such as platinum, iron ore as well as coal. In the 2016/17 financial year it was R2.1 billion (56.5%).