Presidency insists it consulted widely on tax laws

27 January 2016 - 19:16 By Dane McDonald
Image: Supplied

The Presidency on Wednesday slammed reports that there was no consultation on the Tax Administration Laws Amendment Act signed into law by President Jacob Zuma.

“There was an extensive consultation process over the Tax Administration Laws Amendment Act, spanning over two years, before it was signed into law by President Jacob Zuma,” the Presidency said in a statement.

Media reports that there was no consultation are incorrect and misleading, the Presidency said.

Panic and anger set in among workers after Zuma signed the new tax laws such as the 2015 Tax Laws Amendment Act and the Tax Administration Laws Amendment Act into force.

They include a limit on how much may be withdrawn when a worker resigns or is retrenched as part of efforts to force workers to save for their retirement and not withdraw savings for other reasons.

Trade union Cosatu on January 21 called on its members and workers in general to join its efforts to “crush” the new tax law amendments.

“Our opposition to this law remains unwavering and we remain determined to implement our federation’s congress resolution, of fighting the National Treasury’s unilateral decision to control and manage workers' deferred wages,” Cosatu said at the time.

According to the Presidency the government first mentioned the harmonisation of tax contributions to retirement funds in the 2011 Budget by the Minister of Finance, after which public comments and consultation took place.

It said more refined proposals were published in the 2012 Budget and a paper entitled “Improving Tax Incentives For Retirement Savings” was released in October 2012.

“As is the case with tax law, publication is followed by a comment period, during which the public submits their comments for consideration in drafting the bill,” it said.

Fifteen meetings took place with Nedlac (National Economic Development and Labour Council) constituencies from June 2012.

The Bill was first presented in Parliament in 2013. There were 25 other meetings with labour unions in the period up to 2015.

“It should also be noted that Parliament has [requested] that a review of the taxation law be conducted after two years to assess its impact. In this regard the law will be reviewed after two years,” the Presidency said.

Source: Fin 24