On Tuesday, the 26th of August 2014, SAIT’s
Technical Department, represented by Erich Bell (Acting Head of Tax Technical),
Lesedi Seforo (Tax Technical Advisor) and Job Kabochi (VAT Committee Member)
delivered a presentation to the Standing Committee on Finance in an attempt to
curb some of the more questionable amendments contained in the draft Taxation
Laws Amendment Bill, 2014 (‘TLAB’) and the draft Tax Administration Laws
Amendment Bill, 2014. (‘TALAB’).
The most prominent issues that the Technical Department
presented on included:
Clause 88(1)(a) of the TLAB: Proposed removal of
section 11(1)(g) of the Value-Added Tax
Act (No. 89 of 1991) (‘VAT Act’) which would have the effect that suppliers may
no longer zero-rate the specified goods set forth in Schedule 2 to the VAT Act.
Clause 87(1)(a) of the TLAB: This clause needed
clarity regarding the words ‘originates’ and ‘address’.
Clause 34(b) of the TALAB: Proposed that the
definition of relevant material in section 1 of the Tax Administration Act (No.
28 of 2011) be amended to refer to ‘…that
in the opinion of SARS is foreseeably relevant…’ This amendment may lead to
a phishing expedition if no objective oversight is introduced. Furhtermore,
this legislative change may have undesired ramifications on the tax clearance
Proposed changes to section 12E of the Income
Tax Act (No. 58 of 1962) which would have the effect that these small business
corporations would be subject to tax at 28 per cent from the first Rand of
taxable income and that they would then receive a R15 000 refundable
compliance rebate, should they be tax compliant. We feel that the current
system must be retained and that the R 15 000 rebate is too low.
Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.