How much tax Naspers pays in South Africa

Naspers, which owns Media24, Takealot, and a large stake in Prosus, has paid $118.7 million (R2.2 billion) in direct and indirect taxes in South Africa in the last financial year.

Naspers is a global consumer internet group and one of the largest technology investors and operators in the world.

Naspers was founded in 1915 as De Nasionale Pers Beperkt, a publisher of newspapers and magazines.

Under the leadership of Koos Bekker, the company transformed itself to become a global consumer internet company.

Naspers is the largest South African company listed on the Johannesburg Stock Exchange (JSE) and is the majority owner of Prosus.

Through Prosus, the group operates and invests globally in markets with long-term growth potential. Prosus has its primary listing on Euronext Amsterdam.

In South Africa, Naspers is one of the foremost investors in the technology sector. Its subsidiaries include Takealot, Mr D Food, and Superbalist.

Naspers also owns AutoTrader, Property24, PayU, and Media24, South Africa’s leading print and digital media business.

On 24 June 2024, Naspers released its annual financial results for the year ending 31 March 2024.

Naspers’ profit for the year declined from US$9.954 billion to US$6.565 billion. This decline is purely related to Tencent dividends and share sales.

Its Tencent income over the last year was US$7.863 billion. It included US$5.053 billion in gains on Tencent share disposals and US$2.810 billion in shares of equity-accounted investments.

That means that Naspers’ US$6.565 billion profit for the year was US$1.298 less than what it received from Tencent.

Despite the decline, new Naspers and Prosus CEO Fabricio Bloisi said the results illustrate the “amazing progress we’ve made, as well as our future potential”.

“I’m excited about the potential to further leverage our ecosystem and keep improving our results,” he said.

“I’m confident in our ability to innovate, collaborate, and lead within existing and new sectors, as well as grow our businesses’ profitability.”

How much tax Naspers pays – and where

Naspers said paying taxes is an important economic contribution to the societies in which it operates and a normal consequence of doing business.

“We aim to improve the lives of people in the countries where we operate, and paying taxes is an integral part of that aim,” it said.

“Our appetite for tax risk is low. All tax planning is decided and effected in the context of the business.”

“Taxes flow from business operations. Business structures and operational models dictate our tax strategy, not vice versa.”

Naspers informed shareholders that it had earmarked entities in low or no-tax jurisdictions for elimination.

Low or no-tax jurisdictions are countries with no corporate income tax and countries listed on the EU blacklist of non-cooperative jurisdictions for tax purposes.

“We do not have entities in such jurisdictions unless dictated by valid business reasons and local operations,” Naspers said.

“We do not attempt to engineer tax advantages by creating business entities in low-tax jurisdictions unless Prosus operates in these jurisdictions.”

In the last financial year, Prosus and Naspers paid and collected US$1.3 billion (R24 billion) in direct and indirect taxes globally.

Naspers showed a normalised effective tax rate of 26.1% for the 2024 financial year, slightly down from 26.8% the year before.

It paid the most tax in Brazil, with $241.8 million. Romania was second with $229.4 million, followed by The Netherlands with $190 million and Poland with $146.8 million.

South Africa was fifth with $118.7 million, which equates to R2.2 billion at Monday’s exchange rate of R18.24/USD. It is slightly down from $121.1 the year before.

Naspers’ South African tax bill included corporate income and withholding taxes of $20.7 million.

The company also collected $61.8 million in payroll taxes and social security contributions and paid $28 million in VAT, service, and consumption taxes.

The table below shows all the taxes Naspers paid and collected on a country-by-country basis in the 15 jurisdictions with the largest tax contributions.