Update: Consultations with labour on tax law occurred over a period

27 January 2016

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. Media reports that there was no consultation are incorrect and misleading.

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. 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.

Fifteen meetings took place with NEDLAC 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.

When tax legislation is presented to Parliament, a comment period is called for (normally 30 days) and public hearings are held before the Standing Committee of Finance (SCOF). From SCOF, the Bill goes to the Select Committee on Finance of the National Council of Provinces which also holds hearings. This means that parliamentary hearings were held both in 2013 and 2015.

It should also be noted that Parliament has required 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.

Statement issued by Bongani Majola, The Presidency, Pretoria, 27 January 2016