Evaluating the fairness of the proposed carbon tax in South Africa

Thesis (M.Com. (Accountancy))--University of the Witwatersrand, Faculty of Commerce, Law and Management, School of Accountancy, 2014.At the 2013 budget presentation, the South African government indicated its intention to introduce carbon tax starting 1 January, 2015 at the rate of R120 per ton of Co2 equivalent. Prior research confirmed that carbon taxes have the potential to increase price levels, make exports uncompetitive and reinforce income inequality. It was suspected that the proposed carbon tax in the face of other similar taxes in South Africa would result in similar outcome. Furthermore, the socio-economic circumstance of South Africa could make the tax unfair to taxpayers. The object of this research was to evaluate the fairness of the proposed carbon tax in South Africa using the tenets of tax fairness Proposed by Smith (1776). The research methodology adopted was content analysis and correspondence analysis to analyse survey responses. The results of the analysis confirmed that the proposed carbon tax would result in price increases, make exports uncompetitive and reinforce income inequality. It was concluded that the proposed carbon tax would be unfair to taxpayers if implemented as currently designe

A Comparative Analysis of the Treatment of Inflation in South African Capital Gains Tax and the Accrual Systems

Inflation is often defined as a continuous and considerable rise in prices in general. Recently it has become a focal point due to globally elevated levels of inflation. Considering its treatment in the South African legal system, this article unpacks the contrary approaches of the Matrimonial Property Act 88 of 1984 (MPA) and the Income Tax Act 58 of 1962 (ITA) regarding inflation. These two Acts are considered as they provide different approaches to inflation, therefore different outcomes. While the MPA makes provision for inflation in determining the growth of each of the estates of spouses married out of community with the accrual system, the ITA does not recognise inflation insofar as it relates to capital gains tax. Comparing the approaches of the MPA and the ITA reveals disparities in the law and justifies the investigation conducted in this article. Accordingly, this article compares the effect of inflation and capital gains tax and why inflation is not considered when determining the base cost of an asset for capital gains tax purposes. To explain the inconsistency between the MPA and the ITA, this article firstly unpacks the characteristics of the South African matrimonial property regime insofar as it relates to inflation. Thereafter, the article characterises the South African application of the capital gains tax and articulates the shortcomings of existing capital gains tax provisions and the resulting challenges in the application of both Acts. In comparing the ways in which the MPA and the ITA deal with inflation, a clear distinction becomes evident. This article finds that, while the initial inclusion rate for capital gains tax inflation is largely accommodated, subsequent increases in the inclusion rate have erased this provision. Given these findings, this article suggests that the current South African capital gains tax regime's inclusion rate be further investigated to determine whether a wider set of exclusions could be developed to better accommodate inflation

The perceived fairness of turnover tax in the South African tax system

South Africa implemented a simplified Turnover Tax system with effect from the commencement of years of assessment 1 March 2009 in order to help improve the culture of tax compliance. To date the number of applicants has not been significant and a potential reason for this is that it is not fair. Fairness and equality within a tax system is important in order to discourage evasion. The purpose of this research is to explore the perceived fairness of the current Turnover Tax system. Using the principles of a fair tax system as advanced by Adam Smith (1776) a correspondence survey was issued to identify whether the Turnover Tax principles enhance or undermine fairness. The criticisms and provisions of the Sixth Schedule to the Income Tax Act No. 58 of 1962 were investigated to determine whether Adam Smith’s (1776) maxims are promoted or undermined and in turn whether they are perceived as being fair or not. Based on the responses and analysis of the survey, it was deduced that the Turnover Tax system is not being perceived as completely fair. As a result changes need to be implemented to in order to improve the overall compliance and effectiveness of the tax

The perceived fairness of turnover tax

The South Africa Turnover Tax system, implemented on 01 March 2009 to simplify tax for microbusinesses and to improve tax compliance had an insignificant number of registrations and research indicated that a possible reason is the fairness of the tax. The aim of this study is to explore the perceived fairness of the Turnover Tax system. By way of a literature review, criticisms and provisions of the Sixth Schedule to the Income Tax Act No. 58 of 1962 were identified and used as statements on a survey questionnaire. Using the principles of a fair tax system as advanced by Adam Smith a correspondence survey which included two open-ended questions was issued to participants with knowledge of Turnover Tax to establish whether the statements corresponded to any of Adam Smith’s Maxims. The results reveal that the Turnover Tax system is not perceived as completely fair and encourage Government to relook at the legislation with the intend to simplify it further, to removing ambiguity and add detailed lists of excluded services. Education and training of taxpayers is important. A repetition of this study on taxpayers registered on the Turnover Tax system will make further contribution and add to the insight into the fairness of the Turnover Tax system provided by this article

A social justice policy framework for funding the acquisition of higher education qualifications in South Africa

Much of the recent published research on the future contribution of the South African university system to the development of a more just society offers an evaluative framework that contains two principal assertions: firstly, South African under-graduate university students must receive state subsidies from taxpayers; and, secondly, austerity, marketisation, credentialisation, commodification, and related neoliberal conceptions of education and society have hindered efforts to achieve a more just society. This article offers a dissenting analysis that is nevertheless located within a social justice framework. It argues that a student loan system of funding the production of university qualifications is consistent with Rawlsian principles of fairness in the distribution of income and wealth

Fairness and efficacy of the penalty provisions in the Tax Administration Act 28 of 2011

The purpose of this treatise was to examine the fairness and efficacy of the penalty provisions in the Tax Administration Act (the Act). An integrative literature review research method was used. The study commenced with a review of the local and international literature on tax compliance and the fairness and efficacy of penalties. This was followed by a study of the stated objectives of the Fiscus in respect of the strategy and approach to maintaining and improving taxpayer compliance and an analysis of the penalty regime of the Act. A comparative analysis was then performed of the relevant taxing legislation of five countries, which were chosen using a purposeful sample selected from the major trading partners of the Republic and countries with a similar tax framework. Following this, a review was performed of a cross section of the most recent tax related court cases in South Africa in order to assess the extent, consistency and fairness of the application of the penalty provisions. The study then concluded with an integrated assessment of the fairness and efficacy of the penalty provisions in light of the research conducted, and highlighted areas where the legislation appears to meet this objective, followed by recommendations for amendments in respect of policy and implementation. Finally recommendations were made for areas of further research which might improve the validity of the conclusions with respect to the stated objectives of the present research and to inform policy formulation

South Africa - exploring the 2016 planned carbon emissions tax

Thesis (M. Com. (Accountancy))--University of the Witwatersrand, Faculty of Commerce, Law and Management, School of Accountancy, 2014.At the 2009 Copenhagen climate-change talks South Africa proposed a reduction in greenhouse gas emissions by 34% in 2020 and 42% in 2025. This report is intended to research and conclude upon whether South Africa can practically implement a carbon emissions tax in order to reduce the amount of carbon dioxide and other greenhouse gases emitted, as well as on whether the introduction of a carbon emissions tax would be an appropriate way in which to address the climate change problem and South Africa’s contribution thereto. The research undertaken is necessary as South Africa is a relatively large emitter of carbon dioxide and other greenhouse gases thereby contributing to the global problem of climate change which is caused by these emissions and if South Africa wants to honour its proposed reduction, a measure is needed in order to ensure South Africa reduces its harmful greenhouse gas emissions, of which the levying of a carbon emissions tax is researched as such a measure. The research, a detailed literature that identified potential areas of concern or negative impact on the economy and the identified ‘issues’ were when used in a correspondence survey to test the perception of professionals with a knowledge of the proposed carbon tax. The conclusion reached was that a carbon emissions tax cannot be successfully implemented at this time due to the prevailing economic conditions in South Africa as well as the potential resulting negative effects on the country’s low-income population and on South Africa’s international competitiveness. It is recommended that the possibility of implementing a carbon emissions tax should be re-evaluated at a future stage once the country’s economy is more developed

Death taxes - an international search for alternatives

The opponents of the death taxes stand in the left hand corner of the ring and the proponents in the right hand corner. When the bell rings, these two opposing sides exchange blows over the death taxes. The death tax debate lingers in the background of all social conversations and flares up at critical times, such as in election years. To date, no amount of arguing has seen an end to the death tax debate. Although both sides agree that death taxes have shortcomings they cannot agree on the appropriate course of action – no side is willing to concede defeat. However, the death tax debate needs to end; precious time and energy should be focused on issues that are relevant to the current times. The only way in which this debate will end, is if an alternative to the death taxes is found – an alternative that is suitable in the eyes of both the opponents and proponents of the death taxes. There is, nevertheless, a lack of contemporary research aimed at finding death tax alternatives. The existing literature has focused on developing approaches to finding alternative taxes, as opposed to studying the alternative taxes themselves. The primary purpose of this study was to conduct a search for alternative taxes that could replace the death taxes. This search transcended national borders in order to identify international solutions to the age-old problem of death taxes. The suitability of the alternative (in the eyes of both the opponents and proponents of the death taxes) was measured by comparing the advantages and disadvantages associated with the tax alternative identified, to the advantages and disadvantages associated with the death taxes. The secondary purpose of this study was to evaluate whether any of the identified alternatives would be suitable for South Africa. SEPEDI : Baganetši ba lekgetho la lehu ba eme ka lehlakoreng la nngele mola bao ba dumelago go lona, bona ba ipeile ka lehlakoreng la go ja. Ge malokwane a letša phala, go kwagala marumo fela ge ditlhopa tše pedi tše, di botšišana tšeo ba di jelego ngwageng wa tlala. Matswele ona, a kgeila moya. Kganetšo ya lekgetho la lehu kgale entše e swerwe mo maswiswing, e re nyame, e tle e ihlagiše ka dinako tše di kopa kopaneng bjalo ka ngwaga wa dikgetho. Mme fela, ga gona kganetšo efe e kilego ya leka go fetša ntwa ye. Ka bobedi dihlopa di dumelana gore lekgetho la lehu ga se la loka, gomme ga lena kakarêtšô. Empa ga di dumelelane ka tsela ya maleba ye e ka rarollago bothata bjo. Ga gona setlhopa se se ikemišeditšego go beya marumo fase, sa re se fentšwe. Ruri ruri kganetšo ye ya lekgetho la lehu, e swanetše go fela, gomme maatla le nako, di šomišwe mo ditabeng tša sebjale bjale. Tsela ye tee feela yeo e ka fedišago kganetšo ye, ke ge go ka nyakíšíšwa mokgwa o mongwe, wo o ka emelago lekgetho la lehu, selo se tee seo se ka kgotsofatšago dithlopa tše pedi tše. Modiro wo, o thatafatšwa ke gore ga gona dínyakíšíšo tša sebjale bjale mo hlabollong ya lekgetho la lehu. Dingwalwa tšeo di lego gona di lebeletše fela ditsela tše di fapanego tša go ka kgethiša, e sego gore lekgetho la lehu le ka hlabollwa bjang. Ntlha ya pele ya dínyakíšíšo tše, ke go nyakíšíša ditsela tšeo lekgetho la lehu le ka hlabollwago ka gona. Dínyakíšíšo tše, di tshetše mellwane ya setšhaba sa Afrika borwa le ditšhaba tše dingwe tša dinaga mabapi, tšeo di rarollago bothata bjo bjwa lekgetho la lehu. Toka ya tsela e engwe ya go hlabolla lekgetho la lehu, e bonwe ka go nyakíšíša mohola le go lahlega ga mokgwa wo moswa wo. Seo se lebantšhitšwe mahlong a dihlopa tše pedi tše tša lekgetho la lehu. Ntlha ya bobedi ya dínyakíšíšo, ke go bona gore a therešo ruri, ga gona le tsela yeo e kaonafetšego ya lekgetho la lehu, yeo e ka lekanetšwago setšhaba sa rena sa Afrika borwa.Dissertation (MCom)--University of Pretoria, 2012.Taxationunrestricte