Parliament, Tuesday 21 November 2017 - The National Assembly has approved adoption of the Proposed Fiscal Framework, as recommended by the Standing Committee on Finance.
Minister of Finance Mr Malusi Gigaba tabled the Medium Term Budget Policy Statement (MTBPS) in the National Assembly on 25 October. The tabled MTBPS included the revised fiscal framework for 2017/18 and the Proposed Fiscal Framework for the next three years.
The Committee has already reported on the Revised Fiscal Framework and the National Assembly adopted the report at its plenary sitting on 8 November.
In recommending adoption of the Proposed Fiscal Framework, the Committee undertook to monitor its implementation in terms of a range of observations and recommendations. These followed a political overview of the MTBPS from Minister Gigaba on 26 October and an overview from Minister in the Presidency Mr Jeff Radebe of the Mandate Paper which Cabinet approved to give guidance on budget priorities. Cabinet had decided that the Presidency would now, on the basis of the Medium Term Strategic Framework (based on the National Development Plan), provide a framework within which budget priorities should be decided. The Parliamentary Budget Office also provided the Committee with an analysis on the framework and the Congress of South African Trade Unions and the United Nations Children’s Fund, among others, made submissions. To read the Committee’s full report on the framework, which starts on page 5, please
At its plenary sitting today, the National Assembly also passed the Rates and Monetary Amounts and Amendment of Revenue Laws Bill, the Taxation Laws Amendment Bill and the Tax Administration Laws Amendment Bill.
The Rates and Monetary Amounts and Amendment of Revenue Laws Bill includes the major tax changes that were announced in the 2017 Budget, most of which were implemented to raise an additional R28 billion in tax revenues to ensure the sustainability of the public finances. Tax changes in the Bill include changes to the personal income tax tables, such as the new 45% rate on taxable incomes above R1.5 million (effective from 1 March 2017), an increase in the dividend withholding tax rate from 15% to 20%, increases in excise duties on alcohol and tobacco, changes to transfer duties on property sales and increases in the medical tax credit. The Bill also includes the introduction of a Health Promotion Levy, involving a tax on sugar-sweetened beverages. Written and oral submissions were received from a wide range of organisations, academics, industry associations and individuals, many public hearings were held on the issue and there were engagements in the National Economic Development and Labour Council between government, organised business, organised labour and organised community groups.
The Taxation Laws Amendment Bill deals, among others, with company tax exemptions for debt relief, foreign remuneration earned by South Africans and anti-tax avoidance measures.
The Tax Administration Laws Amendment Bill covers, among others, measures to combat VAT fraud and a cumulative annual cap on deductible retirement fund contributions.
To read the Committee’s reports on these Bill, which start on page 3, please click https://www.parliament.gov.za/storage/app/media/Docs/atc/a7218f98-ca11-4285-9ddb-2b170e11b363.pdf
The three Bills passed will now be sent to the National Council of Provinces for consideration. The Proposed Fiscal Framework will also be sent for consideration to the National Council of Provinces.
ISSUED BY THE PARLIAMENT OF THE REPUBLIC OF SOUTH AFRICA
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