Specialist unpacks new tax law amendments

Traders have been advised to get to grips with three amendments to tax acts promulgated over the presidential signature last week as all are directly or indirectly related to customs and excise. They aim to “give legislative effect to some of the tax proposals announced by the minister of finance in the budget review 2014” and “specifically dealing with changes in customs and excise duties”, according to presidential spokesman, Mac Maharaj. In this, he added, they “amend administrative provisions of, amongst others, the Income Tax Act, the Value Added Tax Act, Customs and Excise Act, Securities Transfer Tax Administration Act, Tax Administration Act and Customs Duty Act”. And the names of these pieces of law are a forerunner to the wordy nature of the amendment detail to follow – being “the Rates and Monetary Amounts and Amendment of Revenue Laws Act, (Act number 42 of 2014)”, and “the Tax Administration Laws Amendment Acts, (Acts numbers 43 and 44 of 2014)”. After a full examination of the three amendments, Durban-based attorney, Malcolm Hartwell, director of Norton Rose Fulbright in SA, told FTW that the details of each act would interest specialised sectors within our readership. His comment about Act No. 42 of 2014 was brief and to the point, but also a trifle tonguein- cheek. “This Act gives effect to the increased sin taxes on alcohol and tobacco provided for by the minister of finance in this last budget,” he said. “And, accordingly, affects most of your readership.” Looking at Act No. 43 of 2014, Hartwell indicated that it amended, amongst others, the Customs and Excise Act. “This,” he added, “where it deals with the electronic filing of documents; the protection of personal information following the promulgation of the Protection of Personal Information Act; and the treatment of certain transactions within industrial development zones (IDZs) and special economic zones (SEZs). “Quite importantly, there are numerous provisions in the Customs and Excise Act which allow the minister, without reference to parliament, to amend schedules to the act dealing with tax agreements, anti-dumping duties, countervailing duties, licence fees, the fuel levy and the Road Accident Fund (RAF) levy.” However, Hartwell also pointed out that, in order to curtail the minister’s legislative power, it is standard practice that all of those schedule amendments automatically lapse one year after they have been given effect. “But,” he added, “this act provides that any such amendments made by the minister during the period September 1, 2013 to September 30, 2014 shall not lapse after a year. “The effect of this is to extend the minister’s amendments in relation to the relevant protective duties, fees and levies indefinitely.” Act No. 44 of 2014, Hartwell said, is the one that affects amendments to a whole swathe of tax administration acts – including the Customs and Excise Act, the Customs Duty Act and the Customs Control Act. “Amongst other things,” he added, “it regulates the information that has to be provided in relation to goods and passengers to ensure that there is no breach of the Protection of Personal Information Act. “It deals with technical amendments pursuant to the creation of IDZs and SEZs. It tidies up certain definitions which perhaps previously allowed for ambiguous interpretation.” INSERT & CAPTION As is usual for tax amendment laws, they are opaque and confusing enough to make them inaccessible to most citizens. – Malcolm Hartwell