Category Taxation in South Africa

South Africa Loses Billions in Taxes To Illicit Cigarettes

July 6, 2018 Taxation in South Africa

Illicit cigarettes South AfricaJOHANNESBURG – Cigarette manufacturers in South Africa are fuelling the market for illegal tobacco, where a pack of cigarettes costs less than the tax due on their sale.

According to a new report completed and released by the South African Revenue Service (SARS), the national government is losing billions each year due to the prevalence of illicit cigarette sales. ‘

Approximately three-quarters of all informal shops surveyed across the country appeared to be selling illicit cigarettes.

Currently, a pack of cigarettes in South Africa would carry a minimum tax obligation of SAR 17.85 per pack.

However, the illicit cigarettes were priced lower than the tax, in some cases being as cheap as SAR 5 per pack.

It is impossible that the full tax obligation can be met on the sale of cigarettes that c...

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South Africa’s Sugar Tax Launched

April 4, 2018 Taxation in South Africa

sugary drink taxPRETORIA – South Africa is tackling its obesity epidemic by targeting sugary drinks.

Over the weekend South Africa’s tax on sugary drinks came into effect, with manufacturers now paying out a fee if their drinks are too sweet.

From April 1st, manufacturers and importers of sugar-sweetened beverages will be liable to pay a levy on the sugar content of the drink.

The levy is only charged if the drink has sugar content in excess of 4 grams of sugar per 100 mls.

The rate of the levy is currently set at ZAR 0.021 per gram, for each gram over the 4g threshold.

The threshold was set at 4g to encourage manufacturers to create low-sugar alternatives.

It is hoped that the new tax will help alleviate the problem of obesity in South Africa, as it is now the country with the highest obesity rate ...

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South Africa’s Sugar Tax Approaches

September 6, 2017 Taxation in South Africa

tax on sugary drinksJOHANNESBURG – South Africa’s sugar tax will come into effect in April 2018, however, nobody knows exactly what the tax will look like.

At a joint meeting of Parliamentary health and finance committees in South Africa it was indicated that the country’s proposed tax on sugar sweetened beverages may come into force by April 2018.

However prior to the tax being enacted, the government must still decide on the exact rate of the new tax.

Initially the government hoped to introduce the tax at a rate of 20 percent.

Currently, the government’s proposal has been diluted to a rate of 10 percent at the time of introduction, with gradual increases to the rate as time goes on.

Alternatively, industry leaders are calling for the government to introduce a further watered down tax which would reach ...

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Tax Breaks for Start-Ups Fall Flat in South Africa

July 25, 2017 Taxation in South Africa

Tax breaks for startupsPRETORIA – Tax breaks aimed at fostering a thriving small-business and start-up environment in South Africa have been labelled a resounding failure.

New information released by the South African Revenue Service indicates that the government’s endeavour to boost investment into small business has failed, as over the last two years only one entity has taken advantage of a special tax break for businesses making grants to small businesses.

Currently, an entity which makes grants to small businesses is able to enjoy tax exemptions, if it is registered for the exemption with tax authorities.

The businesses which receive the grants from a registered entity would also enjoy exemptions.

The program of exemptions was started in March 2015, and was intended to encourage a greater level of inves...

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South Africa Eyes Global Income Tax

July 21, 2017 Taxation in South Africa

Income Tax in South AfricaPRETTORIA – Within 2 years South Africans working overseas will be paying taxes in South Africa on their foreign incomes.

South African taxpayers working overseas may soon see a drastic rise in their tax bill, as tax authorities make moves to begin levying income tax on money earned while working overseas.

The South African Revenue Service released a proposed amendment to the national tax code, which would require any South African taxpayer working outside the country to continue paying income tax on their foreign earnings.

Under current regulations, any South African taxpayer who is out of the country for 183 per year, and meets some pre-set income thresholds will not be required to pay income tax on their overseas earnings.

The proposed legislation does allow for a rebate on the taxe...

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