Are tax holidays what’s needed to rev the South African economy’s engine?
The majority of jobs in SA are being created by small and medium businesses, yet statistics show that many of these businesses fail within two to three years of starting up. The usual suspects — red tape, stringent labour laws and lack of funding — are blamed. But it is also said that the country is not creative enough in its support of small businesses. Veli Ntombela, head of tax at Sizwe Ntsaluba Gobodo, says neighbouring countries have introduced special concessions to attract foreign investors to set up business in their countries. This include tax holidays for at least 10 and even up to 15 years. He says SA has a habit of throwing good money out to get bad money. "We have to be creative," he said during a panel discussion on the tax gap because of the informal sector at the annual Tax Indaba in Sandton. The recently released African Tax Outlook report, produced and published by the African Tax Administration Forum (ATAF), found that the informal sector in several of the 21 part...
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