The National Treasury has agreed to postpone the proposed amendments to the 2020 Draft Taxation Laws Amendment Bill (TLAB) and the 2020 Draft Tax Administration Laws Amendment Bill (TALAB), to allow for more investigation and detailed consultation with the mining industry and related stakeholders before any changes to the legislation are made, law firm ENSafrica reports.
The firm notes that this comes after extensive consultation with the Treasury, in which the firm actively participated together with its clients and the Minerals Council South Africa.
In August, ENSafrica posited that the proposed amendment would have adverse and unintended consequences for mining companies, such as excluding not just contract miners but also mining companies that do not hold mining rights (for example, unincorporated joint ventures) from being able to claim the accelerated capital expenditure allowance.
“This [postponement] is a positive outcome for the mining industry and helps create policy and legal certainty for an industry that is in desperate need to attract foreign and local investment and, in turn, boost the South African economy during and post the Covid-19 period.
“However, the battle is not over yet and it is imperative for all taxpayers involved in the mining industry to actively participate in these forthcoming consultations with the National Treasury and the South African Revenue Service to ensure a favourable outcome for all stakeholders, industry and government,” the firm says.