2013 Budget Proposals and the Youth Subsidy

2013 Budget Proposals and the Youth Subsidy


The Youth Subsidy is back in favour after being kicked into touch at the June 2012 ANC Policy Conference in favour of the Job Seeker Grant, which seems to have died a natural death.

The 2013 budget proposes an administratively simple subsidy incentive for the employment of young people that will create a graduated (sliding scale) tax incentive at the entry-level wage, falling to zero when reaching the personal income tax threshold. A similar subsidy is proposed for eligible workers of all ages who earn below tax threshold for under 65 year old employees within special economic zones (not specified).

The two subsidies will be administered through the PAYE system (payrolls plus employers plus SARS) and legislation will be drawn up to define the process as soon as possible. This project will impact on payroll systems. There is no indication at this stage of when this will happen, but because of the urgency to assist jobless young people, be prepared that it will happen during 2013, and earlier rather than later.

At last it looks as though something practical will be done to help the unemployed youth of our country.