A critical analysis of the desirability and efficacy of secondary tax on companies in South Africa

[摘要] This thesis debates the issue of whether Secondary Tax on Companies is a desirableand efficacious tax and whether it is compatible with other government policies andprogrammes.Secondary Tax on Companies is a tax imposed on resident companies and closecorporations, currently at the rate of 12.5%, on dividends declared or deemed to bedeclared by the company to its shareholders.It has proved to be a deeply contentious form of tax in many quarters although it hasbeen declared to be a non negotiable tax as far as the government is concerned. It hasbeen held by many authors that this tax inter alia distorts the financial decisionmaking process and inhibits investment in South Africa.It was concluded by the writer that Secondary tax on Companies is probably notcompatible with other important government programmes such as Black EconomicEmpowerment and employment creation, as well as contributing to South Africa’suncompetitive corporate tax rate.It was therefore concluded that Secondary tax on Companies should be graduallyphased out.

[发布机构] University of the Witwatersrand