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South Africa raises income taxes for first time since 1995

By Reuters | February 26th 2015

Kenya: South Africa will raise income taxes for the first time in twenty years, Finance Minister Nhlanhla Nene said yesterday, as he cut economic growth forecasts and widened budget deficit estimates.

Personal income tax will rise by one per cent for everyone earning more than 181,900 rand ($15,863), in a move likely to be unpopular with the public and businesses already reeling from sluggish growth.

 Economic growth will this year average 2 per cent, down from earlier forecasts of 2.5, and will remain depressed at 2.4 per cent next year, Nene said, warning that forecasts could be slashed further if the current electricity shortage gets worse.

Government revenues will remain depressed, leading to a budget deficit of 3.9 per cent of GDP for the 2015/2016 financial year, above the 3.6 per cent forecast in October, Nene said. -Reuters


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