The chairperson of the Seeff Property Group, Samuel Seeff, has implored Finance Minister Enoch Godongwana to keep personal and property taxes unchanged ahead of his 2024 Budget Speech on Wednesday.
Seeff said this was the bare minimum the property sector could be afforded.
Godongwana is expected to outline all the financial, economic, and social commitments that government will prioritise in the Budget Speech on Wednesday, the final one for the current administration ahead of the elections this year.
This is expected to be a watershed moment for the minister as the country faces a challenging economic and socio-political environment ahead of the national elections later this year.
Samuel Seeff said on Tuesday that he was urging the minister not to tamper with transfer duty and capital gains tax as he believed that these taxes were already quite high.
He argued that there should be tax relief rather than further burdens placed on the already overburdened consumers, home owners and property buyers.
According to Seeff, in the past there was a notable downward impact on the property market when transfer duty and capital gains tax were targeted for hikes.
“Instead of increasing the taxes earned by the government, it resulted in lower sales volumes above R5 million, and reduced the transfer duty taxes earned by government,” he said.
“You have to sell many more properties at R1 million compared to a single R10 million transaction for government to earn the same level of property taxes.”
Four interest rate cuts for 2024
The interest rate could be cut four times this year according to Standard Bank’s chief economist Goolam Ballim.
In early February, Ballim noted that South Africans can look forward to four interest rates cuts of 25 basis points each by the end of 2024.
The predictions come off the back of easing inflation, with the Reserve Bank targeting 3 to 6%.
Standard Bank is forecasting an inflation rate of around 5% for 2024 and believes the Reserve Bank will begin interest rate cuts by the second quarter. This would mean that the repo rate would be down from 8.25% to 7.25% by the end of the year.
“We anticipate that it will mostly be quarter point cuts,” Ballim said.
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