• Service: Tax, Global Indirect Tax, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 2/27/2014

South Africa - Tax proposals in 2014 budget 

February 27:  South African Finance Minister Pravin Gordhan delivered his 2014 Budget Speech on 26 February 2014.

Among the general corporate tax proposals in the budget are measures to:

  • Limit interest deductions for reorganizations and acquisitions
  • Address the refund mechanism for non-cash dividends
  • Provide changes to research and development (R&D) tax incentives
  • Provide tax relief with respect to debt reduction
  • Relax the venture capital company regime
  • Revise the treatment for claiming a capital allowance on improvements to the land and to modify the real estate investment trust (REIT) rules
  • Extend contributed tax capital roll-overs to include instances when deferred shares are converted to ordinary shares
  • Revise the rules for third-party backed shares

The budget also includes corporate tax measures specifically aimed at financial services (e.g., long-term insurance, foreign reinsurance, and savings bonds) and for the oil and gas industry (e.g., tax incentives).

Value added tax (VAT) changes are also proposed.

Read a February 2014 report prepared by the KPMG member firm in South Africa: Tax: 2014 Budget Summary

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