Tax compliance among Small, Medium and Micro Enterprises (SMMEs) has been forced into the spotlight by The South African Revenue Service (SARS) who in January launched a new monthly newsletter dedicated to the sector. The January issue covered the matter of tax compliance and revealed a number of new initiatives by SARS to streamline services and encourage smaller businesses to meet their tax obligations. While SARS indicated that the aim of the new newsletter is to generally “share relevant information pertaining to your SMME’s tax affairs and interaction with SARS [and help] you better understand how to meet your compliance obligations” it's clear that by so comprehensively dealing with compliance in the first issue SARS has earmarked the area as being of major concern and a focus going forward.

Calling it a “good story to tell”, Finance Minister Enoch Godongwana announced, in his first Budget Speech, welcome respite from tax increases, tax relief of R5.2 billion for individuals and businesses, as well as further measures to support businesses in their economic recovery. These include no increase in the fuel levy, and adjusted tax brackets and rebates for individual taxpayers. For companies, there is a reduction in the tax rate, support in the form of an increase in the Employment Tax Incentive, and a revised support scheme for businesses in distress due to Covid-19. In this article, we provide a helpful overview of the important tax announcements made, as well as highlight a few issues mentioned in the Budget Speech to be taken note of.