5 new finance bills passed on to be signed into law

3 years ago 1

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The National Council of Provinces (NCOP) has passed five finance bills, sending them off to president Cyril Ramaphosa to be signed into law.

Parliament has had an exhaustive year filled with the National Treasury scrambling to push through defining financial legislation dealing with a wide array of issues. The latest bills that have been passed include the following:

The bills generally relate to the country’s 2022 budget revisions, making provision for the divvying up of the budget and following through on promises made by finance minister Enoch Godongwana during his speech.

This includes the various adjustments for rates and taxes in the country.

The Adjustments Appropriation Bill and Special Appropriation Bill, meanwhile, deal with the various bailouts or payments given to state companies in the minister’s October budget, including the 70% payment of Sanral’s e-toll debt.

This is what the bills cover:

Taxation Laws Amendment Bill and the Tax Administration Laws Amendment Bill

The Taxation Laws Amendment Bill seeks to amend provisions prescribed under the Income Tax Act, namely, section 7B, which deals with special dispensations for variable remunerations.

Under the amendments, people who rely on performance-based income payments or periodic wages will also be subject to stringent tax compliance requirements.

Parliament further noted that key proposals in the bill also include the imposition of understatement penalty for employment tax incentives improperly claimed, advance rulings under the Customs and Excise Act, as well as addressing the issue of tax compliance.

On the other hand, the Tax Administration Laws Amendment Bill enables other pieces of legislation to make specific alterations and mainly deals with administrative issues relating to the following:

Customs and Excise Act, 1964
Value-Added Tax Act, 1991
Securities Transfer Tax Act, 2007
Tax Administration Act, 2011
Customs Control Act, 2014
Income Tax Act, 1962

Adjustments Appropriation Bill and the Special Appropriation Bill

The Adjustments Appropriation Bill provides for increases to allocations set out in the main Appropriation Act of 2022.

Parliaments spokesperson Moloto Mothapo said that under the Act, total in-year spending adjustments amount to R13 billion, inclusive of the total adjusted appropriations per vote and adjusted estimates of direct charges against the National Revenue Fund (NRF).

Of the total in-year adjustments of R13 billion, R7.24 billion is with respect to direct charges against the NRF.

The bills propose that R6.278 billion and R23.736 billion will be appropriated from the National Revenue Fund and be allocated to the Departments of Public Enterprises and Transport to settle Sanral’s debt regarding the e-toll project.

The R23.7 billion is expected to be used to pay off 70% of the debt, leaving the Gauteng government and its residents to cover the remaining balance.

Other appropriations under the Act include, among others,

R204.7 million for Denel and R101.56 million for the Land and Agricultural Development Bank;
R7.24 billion in direct charges against the NRF;
R5.93 billion towards debt service costs;
R48.5 additional allocation for flood victims in KwaZulu-Natal;
R618.82 million for skills levy and sector education and training authorities.

Rates and Monetary Amounts and Amendment of Revenue Laws Bill

Parliament said that the major objectives of the Rates Bill are to fix the rates of normal tax, amend rates and monetary thresholds, as well as amend rates of duty.

Ultimately, the rates bill deals with the price hikes of beet beverages and the taxation of e-cigarrettes and nicotine liquids.

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