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Parliament Seeks Comment on Draft Taxation Laws Amendment Bill

September 28, 2020

Parliament

Parliament seeks comment on the 2020 Draft Taxation Laws Amendment Bill (2020 Draft TLAB) and the 2020 Draft Tax Administration Laws Amendment Bill (2020 Draft TALAB).

National treasury called for comment on the draft bills at the end of July 2020.

According to an earlier national treasury statement, the draft tax bills contain tax proposals made in the 2020 Budget on 26 February 2020.

Key tax proposals contained in the 2020 Draft TLAB include the following:


• Proposed introduction of export taxes on scrap metals;
• Tax measures required as a result of the modernisation of the foreign exchange control system;
• Aligning the carbon fuel levy adjustment with the Carbon Tax Act;
• Allowing a carbon tax “pass through” for the regulated liquid fuels sector;
• Addressing an anomaly in the tax exemption of employer provided bursaries;
• Clarifying rollover relief for unbundling transactions; and
• Consequential amendments as a result of 2019 changes to section 72 of the VAT Act.

Key tax proposals contained in the 2020 Draft TALAB include the following:


• Amendments enabling the proposed introduction of an export tax on scrap metals;
• Removal of the requirement to prove intent with regard to certain offences listed in the Fourth Schedule to the Income Tax Act, the Value-Added Tax Act and the Tax Administration Act;
• Refusal to authorise a refund where returns are outstanding under the Skills Development Levies Act and the Unemployment Insurance Contributions Act;
• Withholding of a refund pending a criminal investigation; and
• Estimated assessments where relevant material requested by SARS has not been supplied.

The standing committee on finance also seeks comment on the 2020 Draft Rates and Monetary Amounts and Amendment of Revenue Laws Bill (2020 Draft Rates Bill).

Treasury called for comment on the 2020 Draft Rates Bill at the end of July 2020.

Key tax proposals contained in the 2020 Draft Rates Bill include the following:


• Changes in rates and monetary thresholds to the personal income tax tables;
• Adjustment of transfer duty rates to support the property market; and
• Increases of the excise duties on alcohol and tobacco.

Treasury clarified, in the earlier statement, that the 2020 Draft Rates Bill was first published on Budget Day on 26 February 2020 but was “published for the second time in order to solicit any public comments on the tax proposals contained therein”.

Comment on the three draft bills is invited until 6 October 2020.

Public hearings are scheduled for 7 October 2020.

Meanwhile, the committee has also called for comment on the Auditing Profession Amendment Bill.

The bill was tabled in parliament in February 2020.

The bill aims to amend the Auditing Profession Act of 2005, so as to:


• insert a definition;
• strengthen the governance of the Regulatory Board;
• strengthen the investigating and disciplinary processes;
• provide for the power to enter and search premises and to subpoena persons with information required for an investigation or disciplinary process;
• provide for the power to issue a warrant for purposes of entering and searching of premises;
• provide for processes to be followed after an investigation;
• provide for a duty to disclose information;
• provide for sanctions in admission of guilt process and following a disciplinary hearing;
• provide for offences relating to investigation and disciplinary process;
• provide for the protection of personal information;
• provide for transitional measures; and
• provide for matters connected therewith.

The proposed legislation sets down how the investigating committee, disciplinary committee and subcommittees of the Independent Regulatory Board for Auditors (IRBA) are to be constituted.

Detail is provided on powers to enter and search premises, warrants, process following investigation, disciplinary hearing and sanctions in admission of guilt process.

In order to strengthen the independence of the IRBA and address issues of conflict of interest by members of the IRBA, the proposed amendments prohibit registered auditors and candidate auditors from being appointed as members of the IRBA.

The proposed amendment also seeks to empower the investigating committee to authorise an official of the IRBA to enter and search premises or subpoena any person with information required to complete an investigation in order to address issues of non-cooperation by auditing firms during improper conduct investigations.

The IRBA will also be able to, if appropriate, refer a matter brought against a registered auditor to an accredited professional body for investigation.

Comment on the bill is invited until 12 October 2020.

Public hearings are scheduled for 14 October 2020.