In this issue:
•    Budget speech changes: are you ready?
•    Hello Smoke-enders…
•    Alcohol’s at a premium too
•    A day at the races could cost more than you think
•    Gas guzzlers will fetch a higher price
•    You’ll wish the drive to work was shorter
•    Your vote counts- claim your free gift

Dear Reader

Wow – did I get a lot of emails in response to last week’s bulletin (is SARS in your good books?).

Clearly, there are a lot of taxpayers who’ve had very negative experiences dealing with SARS. Thanks for sharing your stories with me — you’ve given me insight into the biggest problems we have with the taxman. And this will help me come up with the solutions for you.

Budget speech changes: are you ready?

I don’t want to bore you with the finer details of Mr Gordhan’s recent budget speech. But I do want to highlight five of the things he mentioned, because they’ll mean higher taxes for you and me.

1.    Hello Smoke-enders…
That’s right. You can expect to pay R1.24 more for your average pack of 20 cigarettes. So, if you buy, say, five packs a week, you’re going to be coughing up an extra R24.80 each month, for your habit. Now that’s an incentive to quit!

2.    Alcohol’s at a premium too
You can expect to pay an extra 6.5 cents per 340ml can of beer. In your average six-pack, that means an increase in price of 39 cents.

Prefer wine? Then you’ll be paying 12 cents extra per 750ml bottle. Meanwhile, liquor sees the highest increase at R2.22 per bottle.

Doesn’t sound like much now, but if your salary’s already stretched then this one will bite you…

3.    A day at the races could cost more than you think!
Up until now, gambling was a tax exempt activity, and your winnings weren’t taxed. But now, a review of this practice has been proposed, so you’ll end up with less of your winnings than you expect, because they’ll now be taxed. We’re not too sure yet if your losses will become tax deductible too…

I see that Pick n Pay has decided to keep the taxman’s fingers out of its competition winners’ pockets. They’ve just launched a competition which will see its winner walking away with a R300 000 cash prize – paid as a lump sum, and totally tax-free.

4.    Gas guzzlers will cost a higher price
We could soon see fewer gas guzzlers on the road (goodbye Hummer?), thanks to a new carbon tax which will take effect on 1 September 2010. Basically, new cars will be taxed based on their carbon emissions. The higher the emissions, the higher the tax. Which means big tickets for the luxury car sector.

5.    You’ll wish the drive to work was shorter
The General Fuel Levy on both petrol and diesel will increase by 17.5 cents per litre, from 7 April 2010.  At the same time the Road Accident Fund Levy will increase by 8 cents a litre. Which means a total increase of 25.5 cents per litre. Goodbye to the road-trip, hello to the staycation (i.e. vacation at home!).

So much for tax relief, Mr Gordhan… If you drive, drink, or smoke, then your income’s going to be eroded by these new (or ramped-up) taxes.

Your vote counts- claim your free gift

I need your vote. I’m testing new titles for our tax and Vat newsletter (it’s time for a makeover!), and I need your input. Tell me which of the potential titles below wins your vote and I’ll send you a free e-report: the Vat pocket advisor:  20 answers to your most common Vat questions.

It covers everything from the basics of Vat invoices, to Vat on African exports and Vat on hired cars.
Simply email me (tax@fsp.co.za), and tell me which of these titles you like, and I’ll send you the e-report:

•    Tax & Vat Advisor
•    Tax & Vat Insider
•    Tax Watch

Until next week
Fulvia Becatti,
Managing Editor: Practical Tax Handbook & Practical Vat Handbook