The government is concerned about the fact that South Africans are currently not saving
enough towards retirement. Inadequate provision for retirement has a negative impact on
the financial independence of retired citizens and leaves them reliant on the government or
family for support. This prevents family members from saving for their own retirement and
increases the burden on taxpayers to fund government grants for the elderly.
In order to motivate South Africans to save more for their retirement, the Minister of
Finance, in his 2013 budget speech, proposed improved retirement savings tax incentives.
The aim of this study was to determine whether South Africans are aware of the proposed
increases in retirement tax incentives and whether these incentives would be sufficient to
encourage them to either start saving or save more for retirement. The literature review
conducted for the purpose of this study revealed that all the relevant existing research is of
an international nature and was undertaken after changes to tax incentives had been
implemented. This study was conducted from a South African perspective and focused on
the likely effect of proposed changes to tax incentives still to be implemented.
The inquiry strategy that was followed was survey research by way of structured face-toface
interviews with 20 participants, based on their responses to eight questions asked in
a questionnaire. The purpose of this research was to develop an understanding of the relationship between changes in tax incentives and savings behaviour, and not to solve
the problem caused by South Africans failure to save sufficiently for retirement. The study
is therefore basic in nature. This is an empirical study since primary data was collected
specifically for this research project. The data represents the participants responses at a
specific point in time and therefore the study is cross-sectional. The study is nonexperimental
as no predictions were made with regard to the outcome of the research
Based on the answers collected during the interviews, it can be concluded that although
people are generally not aware of the proposed changes, these changes in the tax
incentives relating to retirement funds would indeed encourage them to start saving more.
Mini Dissertation (MCom)--University of Pretoria, 2016.