Page 1113 - SAIT Compendium 2016 Volume2

MEMORANDUM ON THE OBJECTS OF TAX ADMINISTRATION LAWS AMENDMENT BILL, 2015
2.75 – 2.82 Customs Duty Act, 2014 2.83 – 2.135 Customs Control Act, 2014
2.136 Tax Administration Laws Amendment Act, 2014: Amendment of section 32
Section 45 of the Value-Added Tax Act, 1991, which deals with ‘Interest on delayed refunds’ was introduced in its amended form by paragraph 134 of Schedule 1 to the Tax Administration Act, 2011. Proclamation 51 of 14 September 2014 announced the commencement of the whole Tax Administration Act, 2011, except certain speci c sections dealing with interest and ‘any provision of Schedule 1 to the Act that amends or repeals a provision of a tax Act relating to interest under that Act, to the extent of that amendment or repeal’. All of the exceptions are part of the Tax Administration Act, 2011, or the different tax Acts but they are not in operation. The provisions of the tax Acts relating to interest which had been amended or repealed are applied to calculate interest until the new interest provisions become effective by a future proclamation. Section 45(2) of the Value-Added Tax Act, 1991, was amended by section 32 of the Tax Administration Laws Amendment Act, 2014. However, this amendment did not mention a speci c effective date and hence became effective on promulgation of the Amendment Act. It is proposed that this amendment will take effect when the interest provisions of the Tax Administration Act, 2011, come into operation.
2.137 Tax Administration Laws Amendment Act, 2014: Amendment of section 52
The change to the effective date of section 52 of the Tax Administration Laws Amendment Act, 2014, relates to the effective date of the interest provisions. Instead of referring to a date determined by the Minister, it should read ‘the date on which section 187(2) of the Tax Administration Act, 2011, comes into operation’. Consequently the amendment will take effect on the same day the original subsection is brought into effect by the President’s proclamation.
2.138 Short title and commencement
The clause makes provision for the short title of the proposed Act and provides that different provisions of the Act may come into effect on different dates.
EXPLANATORY MEMORANDUM ON THE TAXATION LAWS AMENDMENT BILL, 2015 EXPLANATION OF MAIN AMENDMENTS
1. INCOME TAX: INDIVIDUALS, SAVINGS AND EMPLOYMENT
1.1. CLOSING A LOOPHOLE TO ENSURE A CONSISTENT TAX TREATMENT ON ALL RETIREMENT FUNDS
1.2. CLOSING A LOOPHOLE TO AVOID ESTATE DUTY THROUGH EXCESSIVE CONTRIBUTIONS TO
RETIREMENT FUNDS
1.3. WITHDRAWAL FROM RETIREMENT FUNDS BY NON RESIDENTS
1.4. REMOVING ANOMALIES FOR INCOME AND DISPOSALS TO AND FROM DECEASED ESTATE
1.5. MEDICAL TAX CREDITS AS PART OF PAYE AND PROVISIONAL TAX: EMPLOYEES OVER 65 YEARS
1.6. BURSARY AND SCHOLARSHIP EXEMPTION FOR BASIC EDUCATION: GRADE R TO 12
1.7. CLARIFICATION OF THE INTERACTION BETWEEN TAXATION OF SHARE INCENTIVE TRUSTS, TIME
OF DISPOSAL RULES AND ATTRIBUTION OF GAINS TO TRUST BENEFICIARY RULES
2. INCOME TAX: BUSINESS (GENERAL)
2.1. DEBT-FINANCED ACQUISITIONS OF CONTROLLING SHARE INTERESTS
2.2. ANTI-AVOIDANCE RULE IN RESPECT OF ASSET FOR SHARE TRANSACTIONS
2.3. ADDRESSING THE PROBLEM OF RETURN OF CAPITAL AFTER A TAXPAYER HAS HELD A SHARE
FOR THREE YEARS
2.4. REMOVING POTENTIAL ANOMALIES ARISING FROM CANCELLATION OF CONTRACTS
3. INCOME TAX: BUSINESS (FINANCIAL INSTITUTIONS AND PRODUCTS)
3.1. EXTENSION OF MURABAHA AND SUKUK TO LISTED ENTITIES
3.2. ALLOWING REITS TO DEDUCT TAX DEDUCTABLE DONATIONS
3.3. ALLOWING REITS TO DEDUCT FOREIGN TAXES PAID BY FOREIGN VESTING TRUSTS
3.4. ALLOWING REITS TO DEDUCT FOREIGN WITHHOLDING TAXES ON DISTRIBUTIONS MADE BY
FOREIGN VESTING TRUSTS
3.5. REPEAL OF FINANCIAL INSTRUMENT REQUIREMENT ON AMOUNTS TO BE INCLUDED IN THE
INCOME OF A REIT
3.6. TRANSITIONAL TAX ISSUES RESULTING FROM THE REGULATION OF HEDGE FUNDS
3.7. SECURITIES TRANSFER TAX AND CAPITAL GAINS TAX IMPLICATIONS ON COLLATERAL
ARRANGEMENTS
3.8. REFINEMENTS TO SECURITIES LENDING ARRANGEMENTS
3.9. TAX ISSUES RESULTING FROM INTRODUCTION OF THE SAM BASIS FOR SHORT TERM INSURERS
3.10. INCLUDING MICRO-INSURANCE BUSINESS IN THE TAXATION OF SHORT TERM INSURANCE BUSINESS
3.11. REFINEMENT TO RISK INSURANCE BUSINESS OF LONG TERM INSURERS
3.12. LIMITATION OF UNWARRANTED RELIEF FROM TAXATION IN RESPECT OF FOREIGN REINSURANCE
BY LONG TERM INSURERS
4. INCOME TAX: BUSINESS (INCENTIVES)
4.1. URBAN DEVELOPMENT ZONES – ALLOWING FOR THE DEMARCATION OF ADDITIONAL UDZS PER QUALIFYING MUNICIPALITY
SAIT CompendIum oF TAx LegISLATIon VoLume 2 1105