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While the pandemic has had a dramatic impact on business and industrial landscapes, both locally and abroad, one of the industries that has had to adapt or die quickly is the automotive industry, in all its facets. This has meant rethinking the way it does business and what stimulus packages would help to get it firing on all cylinders again.
A third of the food that is produced in South Africa is destined for landfill sites, which are fast reaching full capacity. According to statistics, South Africa produces 10 million tonnes of food waste every year and reportedly, has the largest proportion of food wastage in Africa. Yet, an average of 14 million people go to bed hungry every night and 2,5million of these are children.
South Africa remains in a dire energy crisis with utility costs having increased by 17% most recently and with the local provider desperately needing an additional 5,000 megawatts of generating capacity. And, if we consider that almost 77% of South Africa’s primary energy needs are reliant on coal, then there is no doubt that we are heading towards not only an energy, but an environmental crisis too.
In an address presented by President Cyril Ramaphosa on 21 April 2020, he noted that Government has recognised the significant negative repercussions that the national lockdown is having on our economy, both to businesses and to households across the country. The address also highlighted further tax measures to be implemented as additional relief measures.
The Carbon Tax Act 15 of 2019 (Carbon Tax Act), the Customs and Excise Act 91 of 1964 (Customs Act) and the Customs and Excise Amendment Act 13 of 2019 (Customs Amendment Act) pose numerous uncertainties on the road to implementation of carbon tax. We have mapped out below a pathway to assist taxpayers in navigating the complex statutes regulating carbon tax.
Officially, for the 2019/20 financial year, government will not be increasing income taxes. The only taxes set to increase are the indirect taxes: fuel levies, excise duties on alcohol and cigarettes, and the new carbon tax coming into effect on 1 June 2019. With these increases government estimates that it will raise an additional R1.2 billion.
As expected, this was a conservative budget with no sweeping changes to most forms of taxation. The Finance Minister took advantage of some new revenue sources such as carbon taxes, but, for the most part, continued to stick to the script of limiting bracket creep adjustment, sin taxes and fuel levies to raise more money.