South Africa lowers tax revenue for 2015/16 fiscal year on weak growth;

South Africa cut its year to March 2016 tax revenue target by 0.7 percent to reflect a lower forecast for economic growth, the revenue agency said on Tuesday.

The 2015 GDP growth forecast of 1.5 percent, cut from 2.0 percent, would push revenue collection back to an estimated 1,073.7 billion rand ($74.73 billion), the revenue services said.

Growth in Africa’s most industrialised economy is being curbed by an electricity supply crunch, weak business confidence and a global commodities slump for a country that is a major exporter of minerals to Asian countries, including China, whose economies are also cooling after years of rapid expansion.

“When you look at the performance of the economy, it hasn’t been strong and therefore the view was that we probably need to take the pressure off our revenue collections,” SARS executive Mamiky Leolo told reporters.

Tax revenues jumped by 9.6 percent in the year ended March 2015 to 986.3 billion rand.

Personal income tax accounted for 35.9 percent of that increase after wages rose, while value-added tax (VAT) collections increased by 9.9 percent, comprising 26.5 percent of the total, SARS said.    The number of individuals registered for income tax as of 31 March 2015 increased by 1.4 million from a year earlier to 18.2 million, SARS data showed.

Weaker economic growth could undermine revenue collection in the longer term, with gross revenues likely to be down by 35 billion rand between 2015/16 and 2017/18, the Treasury said on Oct. 21, warning of a knock-on effect on budget deficits and public debt.