Parliament seeks comment on 2022 Tax Bills

08 Sep 2022

Parliament seeks comment on the 2022 Draft Rates and Monetary Amounts and Amendment of Revenue Laws Bill (2022 Draft Rates Bill).

National treasury published the 2022 Draft Rates Bill at the end of July 2022 for comment.

According to treasury, the 2022 Draft Rates Bill was first published on Budget Day and gives effect to the tax proposals announced in Chapter 4 of the 2022 Budget dealing with changes to the rates and monetary thresholds to the personal income tax tables and increases of the excise duties on alcohol and tobacco.

“It has been revised to include changes tabled by the Minister in Parliament on 31 March 2022 and 31 May 2022 regarding temporary relief on the fuel levy as well as the postponement of the effective date of an inflationary increase in the health promotion levy of 4,5 per cent to 2.31 cents per gram of sugary beverages with more than 4 grams of sugar per 100 ml from 1 April 2022 to 1 April 2023.”

Parliament also invites comment on the 2022 Draft Revenue Laws Amendment Bill, the 2022 Draft Taxation Laws Amendment Bill (2022 Draft TLAB) and the 2022 Draft Tax Administration Laws Amendment Bill (2022 Draft TALAB).

Treasury invited comment on the draft bills at the end of July 2022.

The 2022 Draft Revenue Laws Amendment Bill contains proposed amendments dealing with the “two pot” retirement system.

The 2022 Draft TLAB and 2022 Draft TALAB contain the remainder of the tax announcements made in Chapter 4 and Annexure C of the 2022 Budget Review.

Key proposals in the 2022 Draft TLAB include:

  • Progressive increase in the carbon tax rate for 2023 to 2030;
  • Vaping: Taxation of electronic nicotine and non-nicotine delivery systems;
  • Extension of the Research and Development tax incentive sunset date;
  • Impact of IFRS17 insurance contracts on the taxation of insurers; and
  • Reviewing the debtor’s allowance provisions to limit the impact on lay by arrangements.

Key proposals in the 2022 Draft TALAB include:

  • Advance rulings under the Customs and Excise Act;
  • Imposition of understatement penalty for employment tax incentives improperly claimed; and
  • Addressing tax compliance status system abuse.

The standing committee on finance invites comment on the draft bills until 12 September 2022.

Public hearings are scheduled for 13 and 14 September 2022.

Meanwhile, in a statement on the recently tabled General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Bill, treasury pointed out that the proposed legislation, when enacted into law, will “improve South Africa’s adherence to international best practices in combating financial crimes and corruption”.

Treasury added that the “proposed amendment of five pieces of legislation which are administered by different Ministers seeks to fully satisfy the technical compliance deficiencies (deficiencies relating to the adequacy of laws and legal frameworks related to the 40 FATF Recommendations) that were identified in the Mutual Evaluation Report”.

“It should be noted that aside from successfully addressing all or most of the 20 technical deficiencies by the end of the year, South Africa will have the harder task of demonstrating the effectiveness of its AML/CFT laws and frameworks, including demonstrating that the country has credible national risk assessments to deal with money laundering and terror financing, that its supervisory authorities in both the financial sector and in non-financial sectors like the legal profession, gambling sector, estate agents all have appropriate risk-based approaches, and most importantly, that the country’s investigative and prosecuting authorities are able to demonstrate speedy investigations, prosecutions and asset forfeitures for financial crimes and corruption.”

Treasury highlighted the importance that South Africa demonstrates in the next 6 months that it has made significant progress in addressing the deficiencies in the Financial Action Task Force (FATF) recommendations and all 11 Immediate Outcomes to ensure that South Africa avoids being greylisted by the FATF at its February 2023 Plenary meetings.

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(This article is provided for informational purposes only and not for the purpose of providing legal advice. For more information on the topic, please contact the author/s or the relevant provider.)
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