CAPE TOWN- Finance Minister Enoch Godongwana has announced the withdrawal of the R20 billion in tax increases that was provisionally included in the May 2025 Budget.
Godongwana said the decision comes amid an improvement in the country’s fiscal position,
“I am not taxing you — I am returning money back into your pockets,” Godongwana said jokingly as he tabled the 2026 Budget Speech on Wednesday.
The minister also proposed additional tax measures to ease the financial burden on households and businesses.
These include adjusting personal income tax brackets and rebates fully in line with inflation.
“To encourage South Africans to save more, we propose that the tax-free annual investment limit be increased from R36,000 to R46,000 per year,” he said.
“The limit to retirement fund deductions will be raised from R350,000 to R430,000, allowing individuals to invest more each year on a tax-free basis," he said.
Godongwana added that government would assist small businesses by raising the capital gains tax exemption for the sale of a small business for older persons from R1.8 million to R2.7 million.
This will apply to small businesses valued at up to R15 million, instead of the previous R10 million.
“It will enable small business owners to receive more tax relief when they sell their businesses,” he said.