SA’s new carbon tax will impose a blanket cost increase on SA firms, further weakening growth and raising unemployment at a time when the economy is under immense pressure.

Though the inclusion of various tax-free allowances should help firms shoulder the burden initially, uncertainty over the carbon tax regime to be followed after 2022 and the failure to align it with SA’s other climate change instruments are likely to undermine SA’s attractiveness as an investment destination and delay its economic recovery.

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