NEW PROPOSALS AND A POSTPONEMENT UNTIL MARCH 2020 ON THE CARDS
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 Amendment Bill.
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 Service."
Axelson said the amendment would address most of the concerns of individuals such as nurses and teachers who go overseas looking for work.
Cartoon by ZAPIRO
The ‘Africa rising story’ was based on faulty logic – here’s how to fix it
Oct 31 2017 13:47
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 the continent.
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 with 10.1%.
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.
Where does South Africa’s .75 % growth rate fit into this picture?
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