Carbon Tax, Energy-Efficiency Savings and the Electricity Levy
01 March 2013
Posted by: Stiaan Klue
the 2012/13 Budget, it was proposed, in line with the Climate Change Response
White Paper approved by Cabinet in 2011, that carbon tax would be implemented
in 2013/14 at a rate of R120 per ton of CO2 on direct emissions. This rate was
to be increased at 10% per annum until 2019/20. The carbon emissions tax
would be percentage-based
rather than having emissions thresholds.
2013/14 Budget proposes implementation of carbon tax effective 1 January 2015
in accordance with the rates suggested in 2012/13, being R120 per ton of CO2 on
direct emissions, increasing at 10% per annum during the first
implementation phase. During the first phase of implementation between 2015 and
2020, a basic tax-free
percentage threshold of 60% is proposed as previously suggested. Off-set
percentages of 5-10% aim to incentivise emission-intensive and trade-exposed
industries to invest in and develop emission reducing projects outside of their
ordinary operations, thus reducing their carbon tax liabilities.
await the publication of an updated policy paper by the end of March 2013 for
comment and consultation. It is further suggested that some of the
revenues generated through the carbon tax will be used to fund
energy-efficient savings tax incentives. The implementation of the carbon
tax envisages the possibility that the electricity
levy will gradually be phased-out.
has proposed an extension of the incentive related to the exemption of income
from Clean Development Mechanism projects until 31 December 2020, in light of
the second commitment period of
the Kyoto Protocol.
Botha, Associate, Tax, Cliffe Dekker Hofmeyr