1. Presentation by the CFO FORUM to the Standing Committee on Finance 16 September 2015 Marc Lewis

2. The CFO FORUM
Group of Chief Financial Officers of major JSE listed and larger state-owned companies
Our aim is to contribute positively to the development of South Africa’s policy and practice on financial matters that affect large business
Formed in 2011 with no specific industry bias

3. The Efforts of SARS and National Treasury
Commitment to offer balanced views in engagements with key stakeholders
SARS and NT to be congratulated on their efforts to bring SA tax system and administration in line with world class standards
Moderation to excessive administrative powers balance the interests of business and tax collector
Perception of fairness and equity is an incentive for voluntary and full compliance
Parties should work towards reciprocal trust and transparency

4. 2015: TAA Proposed Amendments
Extension of the prescription period
Prescription provides certainty to both business and SARS
Investigations involving long elapsed tax years unduly absorbs resources of business
System changes
Staff turnover
Document archiving
Proposed amendment would provide SARS with excessive power – assessments kept open for up to eight years
Remedies in case of fraud and misrepresentation
Unilateral power granted to SARS is out of the ordinary and does not compare favourably to other jurisdictions

5. 2015: TAA Proposed Amendments
Powers to interview third parties
Enquiry procedure which safeguards taxpayers already exists
Proposed amendment possibly administratively unfair – taxpayer already bears the onus of proving that an assessment is incorrect
Employees interviewed despite
Relationship to or knowledge of tax affairs
Without consent from taxpayer
Without knowledge of taxpayer
Without authority from taxpayer
Original purpose of this section – informal interviews to obviate need for further audit – now nullified

6. 2015: TAA Proposed Amendments
Provisional tax payments based on increased estimates by SARS
SARS’ decision on increased provisional tax estimates is now final
Constrains cash flow of business in variable economic times and volatile commodity prices
Remedy through the courts is costly and inefficient for both business and SARS

7. 2015: TLAB Proposed Amendments
Rebate for foreign taxes – s 6 quin
Removal contrary to South Africa’s objective of becoming a regional services centre for the rest of the African continent
A strong case was made by National Treasury when Rebate introduced in 2011
Removal will impact profitability of businesses that support that policy intention – double tax
Intention behind the Rebate was for SARS to liaise with the foreign revenue authorities to ensure that the provisions of the tax treaties are respected
Partial relief in form of a deduction does not assist
ATAF?

8. THANK YOU
AND
QUESTIONS