The National Treasury and South African Revenue Service (Sars) on Wednesday published the revised 2016 Draft Rates and Monetary Amounts and Amendment of Revenue Laws Amendment Bill and 2016 Draft Rates and Monetary Amounts and Amendment of Revenue Laws (Administration) Bill.

The revised draft Bills contain a revised special voluntary disclosure programme (SVDP) to give noncompliant taxpayers the opportunity to voluntarily disclose offshore assets and income before the new global standard for automatic exchange of information between tax authorities commences in 2017.

The draft Bills were initially published for comment on February 24 and April 12 respectively. Following public comments received and a consultation meeting on June 10, some changes were made, resulting in the revised draft Bills.

The changes include that instead of calculating two different amounts to be included in taxpayers’ taxable income, the calculation now comprises only one amount.

This amount equals 50% of the highest value of the aggregate of all assets situated outside South Africa between March 1, 2010, and February 28, 2015, that were derived from undeclared income, which will be included in taxable income and subject to tax in South Africa.

The value referred to above is the market value determined in the relevant foreign currency translated to rand at the spot rate at the end of the tax period in which the highest value fell.

The undeclared income that originally gave rise to the assets mentioned above will be exempt from income tax, donations tax and estate duty liabilities arising in the past. However, future income will be fully taxed and assets declared will remain liable for donations tax and estate duty in the future, should the applicant donate these assets or pass away while holding them.

Taxpayers who disposed of any foreign held assets prior to March 1, 2010, may also apply for relief under the SVDP. Special deeming provisions will apply in this regard.

Any noncompliance with respect to value-added tax, employees’ tax, unemployment insurance fund contributions and skills development levies will not qualify for the SVDP.

However, relief for penalties associated with noncompliance of these taxes will continue under the existing voluntary disclosure programme in terms of the Tax Administration Act.

The Standing Committee on Finance will convene public hearings on the revised draft Bills before their formal introduction in Parliament. Given the truncated Parliamentary programme, as a result of the upcoming local government elections, the first Parliamentary hearings on the draft Bills are only expected to be convened in the second half of August.