The National Treasury and the South African Revenue Services (SARS) issued a number of draught Bills on Friday, and the public has until August 29, 2022, to comment on them.
They are the draught Rates and Monetary Amounts and Amendment of Revenue Laws Bill (2022 draught Rates Bill), the draught Revenue Laws Amendment Bill (2022 draught TLAB), and the draught Taxation Laws Amendment Bill (2022 draught TLAB) (2022 draught TALAB).
The 2022 draught Rates Bill, which first appeared on Budget Day, implements the tax adjustments proposed in Chapter 4 of the 2022 Budget, which deals with modifying the rates and monetary thresholds for the personal income tax tables as well as raising the excise taxes on alcohol and cigarettes.
“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 percent to 2.31 cents per gramme of sugary beverages with more than 4 grammes of sugar per 100 ml from 1 April 2022 to 1 April 2023,” the Treasury stated.
The “two pot” retirement system is one of the suggested changes in the draught Revenue Laws Amendment Bill for 2022.
The suggested changes put into practise the prior declarations made by the Minister in the February 2021 Budget Speech and the November 2021 Medium Term Budget Policy Statement.
The National Treasury published a discussion document titled “Encouraging South African families to Save More for Retirement” for public comment on December 15, 2021.
These revisions also follow that document.
The other tax announcements made in Chapter 4 and Annexure C of the 2022 Budget Review, which are more complex legislatively and necessitate additional public consultation, are included in the 2022 draught TLAB and 2022 draught TALAB.
The following important suggestions are contained in the proposed TLAB for 2022:
A gradual rise in the carbon tax rate between 2023 and 2030;
Vaping: Taxation of nicotine and non-nicotine delivery devices used electronically;
Extending the deadline for the Research and Development tax benefit;
The effect of IFRS17 insurance contracts on insurers’ taxation;
Examining the debtor’s permission clauses to lessen the effect on lay-by agreements.
Important recommendations in the draught TALAB for 2022 include:
In accordance with the Customs and Excise Act, advance rulings;
Imposing an understated fine for fraudulently declared employment tax incentives; Addressing misuse of the tax compliance status system.
According to the Department, the draught tax revisions must still be presented as two separate measures, one dealing with money bill concerns under section 77 of the Constitution and the other with tax administration-related matters under section 75 of the Constitution.
“National Treasury and SARS typically engage with stakeholders through public workshops to discuss the written views on the draught tax laws after receiving written comments. Before the 2022 draught tax bills are formally introduced in Parliament, the Standing Committee on Finance (SCoF) and Select Committee on Finance (SeCoF) in Parliament are anticipated to issue a similar request for public comment and hold public hearings.
The bills will then be revised, taking into account public comments and recommendations made during committee hearings, before being formally introduced in Parliament for its consideration.
“Thereafter, a response document on the comments received will be presented at the parliamentary committee hearings,” states the statement.
The 2022 draught tax bills can be viewed on the National Treasury (www.treasury.gov.za) and SARS (www.sars.gov.za) websites, together with the associated draught Explanatory Memoranda offering a detailed description of the proposed tax adjustments contained in the 2022 draught Revenue Laws Amendment Bill.
The 2022 Budget Review, which is available on the National Treasury website, has more broad information underlying the adjustments to rates, thresholds, and other tax provisions.
Date by which public comments on the draught tax bills for 2022 are due
By the close of business on August 29, 2022, send written comments to SARS and the National Treasury’s tax policy depository at acollins@sars.gov.za and 2022AnnexCProp@treasury.gov.za.