Minister of Finance, Tito Mboweni (Photo by Gallo Images/Ziyaad Douglas)
Gallo Images/Ziyaad Douglas
- Finance Minister Tito Mboweni will ask Parliament to extend some Covid-19 tax relief measures.
- Treasury has said additional proposals for relief will be considered in terms of their potential impact on the fiscal framework.
- SARS and Treasury meanwhile have published four other draft tax bills for public comment.
Finance Minister Tito Mboweni will ask Parliament’s standing committee on finance to have certain Covid-19 tax relief measures extended, National Treasury said in a statement.
Treasury and the South African Revenue Service on Friday published four draft tax bills for public comment. These comments are to be received by the organisations by 31 August.
The Covid-19 Tax Bills, however, which were introduced in Parliament during the tabling of the supplementary budget in June, make tax provisions which are over and above the other four bills.
Treasury and SARS have provided R70 billion in tax relief measures to cushion the blow of the pandemic, by improving cashflows of households and businesses over a four-month period. Some of these measures came into effect on 1 April and 1 May, and are due to end on 31 July and 31 August, respectively.
Having considered written public comments and presentations by stakeholders at public hearings hosted by the standing and select committees of finance, the minister of finance, will in terms of the Money Bills Amendment Procedure Act, request extensions on three measures from the standing committee of finance, according to Treasury.
The measures are:
- Streamlined special tax dispensation for funds established to assist with Covid-19 disaster relief efforts: “This tax relief provides a special tax exemption for Covid-19 relief funds for a period of four months from 1 April 2020 to 31 July 2020. It is proposed that the four-month period be extended by two months to six months. As a result, this relief will cease to apply on 30 September 2020,” Treasury said.
- Deferral of payment of employees tax liability, for compliant small and medium-sized businesses: This allows for deferred payment of 35% of employees tax these businesses have deducted in the four months between April and July. It is proposed the four-month period be extended by one month. “As a result of this extension, repayments on the deferred tax will now only begin in October 2020 and run through until March 2021,” Treasury said.
- A 90-day deferral for the payment of excise taxes on alcohol and tobacco: Compliant businesses were able to defer payment of excise taxes on alcohol and tobacco by 90 days, to assist them for payments to be made in May and June, Treasury said. “It is proposed that a 90 day deferral to assist compliant businesses in respect of payments of excise taxes on alcohol to be made in August and September of 2020 be introduced. It is proposed that the deferral in respect of payments of excise taxes on tobacco originally to be made in May and June 2020 be extended to 150 days.”
Treasury said additional proposals aimed at reducing the negative impact of the Covid-19 pandemic, but which are not already included in the Covid-19 tax bills, will be considered based on their impact on the fiscal framework approved by Parliament, among other criteria.