Total Tax Contribution - How much do large South African companies really pay?

In 2007 we carried out a research project to establish the way in which the South Africa tax system impacts on large companies/ groups. The results confirmed the significant contribution that these companies make to the South African economy.

Key findings of the report include:

• The total number of business taxes in South Africa was 23. This includes 21 national taxes and 2 local taxes.
• The 50 participants bore R49 622 million in taxes, representing 9.9 percent of total estimated South African government taxation receipts from these sources.
• For every R1 of corporate income tax paid, a further R0.51 was paid in the form of other business taxes. Corporate income tax therefore comprises only 66 percent of all taxes borne by companies.
• In addition to taxes borne, taxes collected from customers and/or employees totalled R52 890 million, representing 16.4 percent of total estimated South African government taxation receipts from these sources.
• For every R1 of taxes borne, a further R1.07 was collected on behalf of the South African government.
• Participating companies bore as many as 15 different taxes and on average they were responsible for 8.7 taxes.
• The average number of taxes collected was 3.2 different taxes.
• The average Total Tax Rate (total taxes borne as a percentage of total South African profits before all business taxes) for participants was 34.3 percent.
• The total cost of SA tax compliance for participants, including their external spend to external tax service providers, was R144,8 million.
• On average the cost of compliance represents 0.81 percent of their tax payments (taxes borne and collected).
• The companies surveyed paid an amount equal to 16.8 percent of their turnover in taxes in the form of taxes borne and taxes collected. This was split as 8.1 percent of taxes borne and 8.7 percent of taxes collected.

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