NEW PROPOSALS AND A POSTPONEMENT UNTIL MARCH 2020 ON THE
The Treasury has agreed to withdraw its controversial
proposal to repeal a six-month tax exemption on foreign income earned abroad.
Instead, it plans to introduce a R1-million threshold before taxes are imposed,
in specified circumstances.
Implementation of the new set-up will be postponed to March
1 2020, instead of the initially proposed March 1 2019 for the old plan. This
will give people more time to adjust their contracts or circumstances, or
formalise their tax status. Finance Minister Malusi Gigaba has still to approve
of the proposed amendments.
Treasury director for personal income taxes and saving Chris
Axelson made the announcements at a meeting of parliament's standing committee
on finance when presenting the Treasury's response to public submissions on the
draft Taxation Laws Amendment Bill and the draft Tax Administration Laws
In terms of the proposal, the first R1-million of foreign
remuneration will be exempt from tax in South Africa "if the individual is
outside the Republic for more than 183 days, as well as for a continuous period
of longer than 60 days during a 12-month period", Axelson said.
South African tax would be applied for foreign-earned income
greater than R1-million.
"The exemption threshold should reduce the impact of
the amendment for lower- to middle-class South African residents who are
earning remuneration abroad. The effect of the exemption will also be that
South African tax residents in high income tax countries are unlikely to be
required to pay any additional top-up payments to the South African Revenue
Axelson said the amendment would address most of the
concerns of individuals such as nurses and teachers who go overseas looking for
Cartoon by ZAPIRO
The ‘Africa rising story’ was based on faulty logic –
here’s how to fix it
Until a couple of years ago, all financial institutions and
investment banks were celebrating ‘Africa Rising’, in a symphony of compliments
that should have cautioned any reasonable African leader as well as citizens on
But what did they really mean when they were saying that
Africa was rising?
They simply meant that its GDP, which is the conventional
measure of economic growth, had been growing (on average) at a faster rate than
in other regions of the world.
Of the world’s top 10 countries in real GDP growth rates for
2012, five were indeed African.
Libya topped the list, with an astounding 124%, followed by
Sierra Leone with 15.2%, Zimbabwe with 13.6%, Niger with 11.8% and Ivory Coast
A year later, in 2013, South Sudan was Africa’s best
performer, with 29.3%.
Ever since, other very fast growing economies included
Angola, Chad and the Democratic Republic of Congo.
But GDP tells us nothing about the health of an economy, let
alone its sustainability and the overall impact on human welfare.
GDP is simply a measure of market consumption, which has
been improperly adopted to assess economic performance.
South Africa’s .75 % growth rate fit
into this picture?
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