VAT
- The Western Cape High Court has delivered a landmark judgment on
  VAT regulations in South Africa, ruling that the proposed VAT increase,
  which was set to take effect on May 1, 2025, has been suspended.
  This ruling brings relief to consumers and businesses across the country,
  ensuring that no VAT increase will proceed without full legislative oversight.
Personal income tax
- Personal income tax rebates and tax brackets are not adjusted.
Medical tax credits
- No change to the medical tax credits.
Excise duties
- Increase in excise duties of 6.75% on alcohol products, and between 4.75% and 6.75% on tobacco products.
Fuel and RAF levies
- To replace a portion of the lost revenue from the withdrawal of the
  VAT rate increases, government proposes an inflationary increase in
  the general fuel levy for petrol and diesel to R4.01c/ℓ and R3.85c/ℓ,
  respectively, effective from 4 June 2025.
Renewable energy allowance
- The 125% renewable energy asset allowance is not extended beyond its current end date of 28 February 2025.
Employment tax incentive
- Effective 1 April 2025, the formula to calculate the incentive and the eligible income bands will be adjusted to maintain the maximum value of the incentive at R1 500 per month in the first 12 months and R750 per month in the second 12 months.
Diesel rebate
- From 1 April 2026 farming, mining and forestry businesses will qualify for diesel rebate on all eligible diesel purchases (currently 80%).
Transfer duty
- The transfer duty table is adjusted by 10% to compensate for inflation.

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Budget Highlights 2025/2026

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