Chairperson, serving on a finance committee without a proper background in taxation makes proper participation in regard to those laws very difficult sometimes. Without a full-time tax lawyer dedicated to the work of the Portfolio Committee on Finance, I sometimes wonder what role we play other than going through the motions of making law - making a few changes here and there in what we understand, but then carrying on with business as usual. We rely heavily on the public hearing process, and I want to thank those who participate every year by coming to our committee meetings.
However, there are a few valuable key issues in the pieces of legislation. The new and more beneficial tax regime for companies in special economic zones is welcomed. Further improvements to ensure that employers will be able to assist their lower income employees to acquire loans that are below market value to buy a house without a fringe benefit tax payable is good news.
There is also a range of changes in regard to retirement savings. Members must listen to this, especially Ministers. In terms of a new principle, any contribution made by an employer to an approved South African retirement fund will be taxable as a fringe benefit in the hands of the employee. Whether the new ruling is good for the principle of saving, which is something South Africans are not good at, is debatable. Also, the fact is that the employer's contribution to an employee fund has been kept only at R350 000 tax free, and this is too low. The committee has asked for it to be raised and I hope our plea will be honoured in the next Budget, in 2014.
According to hon Dion George's calculation of the extra monthly tax payable by Members of Parliament, the Speaker will pay R22 000 more; a Minister will pay R17 612 more; a Deputy Minister will pay R12 442 more; and a House Chair will pay R10 700 more in taxes per month, if this goes through. [Interjections.] I will not tell you what ordinary members will pay, but I am telling you that this is hitting hard! [Interjections.]
Let us go to another topic. Any bona fide bursary or scholarship granted by the employer to an employee or relative is exempted from income tax on certain conditions. This is welcomed and will assist underprivileged South Africans to enrol for postmatric education.
The Tax Administration Laws Amendment Bill is amended to bring search and seizure provisions in line with the Constitution. This is welcomed!
Let me conclude by thanking all taxpayers in South Africa who pay their due taxes on time and when they are asked for. Cope will support both Bills. [Applause.]