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Parliament Gives Carbon Tax Bill Green Light

March 29, 2019

Parliament

29 March 2019

A raft of finance-related bills has been passed by parliament and sent to president Ramaphosa for assent.

Bills include the Carbon Tax Bill, Customs and Excise Amendment Bill, Public Investment Corporation Amendment Bill, Financial Matters Amendment Bill, Division of Revenue Bill and the Public Audit Excess Fee Bill.

Carbon Tax Bill

The Carbon Tax Bill was tabled in parliament in November 2018.

The second Draft Carbon Tax Bill was published for comment in December 2017.

Public hearings on the bill were held on 13 March 2018.

The bill aims to:


• provide for the imposition of a tax on the carbon dioxide (CO2) equivalent of greenhouse gas emissions; and
• provide for matters connected therewith.

The bill calls for a R120 per ton carbon tax.

The tax is scheduled to come into effect on 1 June 2019.

Customs and Excise Amendment Bill

The Customs and Excise Amendment Bill was tabled in parliament at the beginning of February 2019.

The bill aims to amend the Customs and Excise Act of 1964 so as to:


• make provision for the administration and collection of carbon tax revenues; and
• provide for matters connected therewith.

The bill’s explanatory summary had referred to the intention to insert a new provision for the purpose of the administration of allowances and limitation of allowances in relation to the Carbon Tax Bill; require that a taxpayer as defined in the Carbon Tax Bill license premises as may be prescribed by rule; regulate actions pertaining to submission and verification of accounts, collection and payment of the carbon tax and allow the Commissioner to make rules insofar as it is necessary to regulate duties, powers and rights not regulated by the Carbon Tax Bill in relation to collection and payment of the carbon tax.

Public Investment Corporation Amendment Bill

The Public Investment Corporation Amendment Bill was tabled on 15 February 2019.

The committee bill aims to amend the Public Investment Corporation Act of 2004, so as to:


• insert certain definitions;
• determine the composition of the corporation’s board of directors and to provide for the progressive implementation of the new composition;
• provide for the Minister to designate the Deputy Minister of Finance or any Deputy Minister in the economic cluster, in consultation with Cabinet, to be the chairperson of the board;
• provide for the Minister to appoint the members of the board in consultation with Cabinet;
• provide for specific representation on the board;
• require directives regarding the management of the corporation to be tabled in the National Assembly and before the depositors, as well as that it must be published;
• require the corporation to consider certain guidelines when investing deposits;
• require the corporation to publish and submit a report on all investments to the Minister for tabling;
• provide for annual reporting on requests for approval made in terms of legislation;
• provide for a procedure that the Minister must follow before making regulations;
• provide that the Minister must table regulations in the National Assembly; and
• provide for matters connected therewith.

Financial Matters Amendment Bill.

The Financial Matters Amendment Bill was tabled in parliament at the end of January 2019.

Treasury briefed parliament on the draft bill in November 2018.

Comment was sought on the proposed legislation in August 2018.

Cabinet approved the draft bill for tabling in parliament at its last meeting of 2018 on 5 December.

The bill originally intended introducing amendments to the Auditing Profession Act of 2005.

However, during deliberations, the standing committee on finance decided that there was not enough time before the end of the 5th parliament to process the proposed amendments to the Auditing Profession Act and they were subsequently removed from the bill.

Acts to be amended include the Insolvency Act, Military Pensions Act and Banks Act.

The bill aims to amend:

• the Insolvency Act, 1936, so as to provide for a process when a creditor realizes his or her security in terms of a master agreement and for a power for the Master to deal with disputes raised by the trustee and other creditors regarding preference of that secured creditor;
• the Military Pensions Act, 1976, so as to provide for all categories of spouses and for life partners of members by amending, inserting and deleting certain definitions; and by providing for both genders throughout the Act and regulating the registration of a spouse to qualify for benefits upon the death of a member;
• the Banks Act, 1990, so as to regard national state-owned companies as public companies for purposes of the application of the Banks Act; to determine prerequisites for these companies and their holding companies to qualify to apply for establishment as a bank; and to provide for inconsistencies between the Banks Act and certain other legislation with respect to state-owned companies; and
• the Government Employees Pension Law, 1996, so as to replace the divorce debt approach with a pensionable service reduction approach to adjust the benefit of a member of the Government Employees Pension Fund following a pension interest assigned to a former spouse of the member as result of a decree of divorce or for the dissolution of a customary marriage; and to provide for a transitional measure.

Division of Revenue Bill

The Division of Revenue Bill seeks to:

• provide for the equitable division of revenue raised nationally among the national, provincial and local spheres of government for the 2019/20 financial year, the determination of each province’s equitable share and allocations to provinces, local government and municipalities from national government’s equitable share and the responsibilities of all three spheres pursuant to such division and allocations; and
• provide for matters connected therewith.

Public Audit Excess Fee Bill

The Public Audit Excess Fee Bill was tabled in parliament on 2019 Budget day.

The bill seeks to:

• provide that the specified excess of the audit fee of certain categories of organs of state, payable to the Auditor-General, as envisaged in the Public Audit Act, 2004, is, if the stated conditions are complied with, a direct charge against the National Revenue Fund; and
• provide for matters connected therewith.

According to a cabinet statement in November 2018, the bill proposes that audit fees in excess of 1% of expenditure of municipalities and certain other public institutions payable to the Auditor-General, be treated as a direct charge against the National Revenue Fund.