Treasury amends “double-tax” for people earning money outside the country, following complaints
Treasury has agreed to withdraw its controversial proposal to repeal a six-month tax exemption on foreign income earned abroad.
According to a report by TimesLive, it instead plans to introduce a R1 million threshold before taxes are imposed, in specified circumstances.
These changes will now also only come into effect on 1 March 2020, instead of the originally slated 1 March 2019 implementation date.
Treasury received more than 1,300 objections to the proposal, mainly from South Africans working in low-or no-tax countries in the Middle East, who would be most affected by it.
Nigel Green, founder and CEO of financial consultancy of the deVere Group called the removal of the exemptions “draconian”.
“The move is totally unjust and breaks the cornerstone principal of taxation: that the taxpayer receives government services for their taxes, such as healthcare, education, roads and police services,” he said.
“These plans are highly discriminatory. It is simply unfair to tax someone because of their citizenship. Indeed, residence and/or territoriality are the only criteria upon which a fair income tax system should be based
“This draconian move to double tax South African expats effectively shackles them to South Africa and they would no longer enjoy the same freedoms as almost everyone else in the world.”
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