Copying and distributing are prohibited without permission of the publisher

Carbon tax could hit South Africa within a year

22 February 2012

Matthew Gilleard - ITR

Email a friend
  • Please enter a maximum of 5 recipients. Use ; to separate more than one email address.


As part of finance minister Pravin Gordhan’s 2012 budget, it was announced today that South Africa is considering the introduction of a carbon tax as early as next year.

The budget stated that a revised policy paper on a carbon tax will be published this year for a second round of public comment and consultation. The country’s commitment to moving forward with this issue has already been established.

"As set out in the Climate Change Response White Paper approved by Cabinet in 2011, the need to price carbon emissions and the phasing in of a tax instrument for this purpose are accepted," the budget document said.

Wian de Bruyn, associate director at Grant Thornton’s Johannesburg office, confirmed that the government intends to progress with the next steps towards introducing a price on carbon emissions.

"It seems likely that the government will be moving in the direction of a draft policy paper some time this year," de Bruyn said.

However, the implementation of a carbon tax is not going to be easy, as Australian prime minister Julia Gillard will testify.

Ben Strauss, director at Cliffe Dekker Hofmeyr, a member of the DLA Piper Group, believes there is still a long way to go.

"I think more work needs to be done and there will be a lot of resistance from business," he said. "Note that we do already have an ad valorem carbon tax on new motor vehicles."

Mark Linington, head of tax at Webber Wentzel, agreed that it is "too soon" and that there is "still too much to be considered".

Strauss went on to echo the thoughts expressed by many Australian taxpayers throughout the last year, that progressing with a carbon tax in the absence of any global accord would be disastrous for the country’s economy.

"In my opinion, particularly as a developing country, South Africa cannot afford to impose a carbon tax which will increase its input costs and decrease its competitiveness globally."






International Tax Review Profile

20% CT v 25% DPT @George_Osborne policy clearly working whether one agrees with it or not @amazon #BEPS

May 23 2015 08:17 ·  reply ·  retweet ·  favourite
International Tax Review Profile

RT @FT: #Amazon to book UK sales in Britain not Luxembourg, bringing revenues in 3rd biggest market in reach of taxman http://t.co/x8q6Pqe0

May 23 2015 08:07 ·  reply ·  retweet ·  favourite
International Tax Review Profile

RT @DeloittePolska: RT @IntlTaxReview: Our choice for the Poland Transfer Pricing Firm of the Year prize is @DeloittePolska! #ITRawards2015

May 23 2015 07:59 ·  reply ·  retweet ·  favourite
International Tax Review Profile

RT @GlobalTaxAdvice: #Taxand wins 5 @IntlTaxReview #European #Awards 2015! Discover more > http://t.co/b2RCGwE8rD http://t.co/HmKFvqeGtJ

May 23 2015 07:59 ·  reply ·  retweet ·  favourite
International Tax Review Profile

RT @bakermckenzie: We are thrilled to have won Seven @IntlTaxReview Awards! http://t.co/4dJQnIR0D4

May 23 2015 07:59 ·  reply ·  retweet ·  favourite
International Correspondents

After the Irish budget, what would make you more likely to put more substance into Ireland?