Taxation Laws Amendment Act

3. Section 18 of the Transfer Duty Act, 1949, is hereby amended— (a) by the substitution for the words “Supreme Court” in subsections (1 and (2) of the words “High Court”; and (b) by the substitution for subsection (3) of the following subsection: 15 20 “(3) Any judgment given or order made by a provincial or local division of the said [Supreme Court] High Court in terms of subsection (2) shall be subject to appeal to the [Appellate Division of the Supreme Court of South Africa] Supreme Court of Appeal in the. same manner 25 and on the same conditions as a judgment given or order made in a civil proceeding in that provincial or local division.”. 6 No. 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 Amendment of section 19 of Act 40 of 1949

4. Section 19 of the Transfer Duty Act, 1949, is hereby amended by the substitution for the words “Supreme Court” of the words “High Court”. Amendment of section 1 of Act 45 of 1955, as amended by section 1 of Act 59 of 1957, section 1 of Act 65 of 1960, section 7 of Act 77 of 1964, section 3 of Act 92 of 5 1971, section 9 of Act 106 of 1980, section 5 of Act 86 of 1987, section 7 of Act 87 of 1988, section 6 of Act 97 of 1993 and section 2 of Act 140 of 1993 .

5. Section 1 of the Estate Duty Act, 1955, is hereby amended by the substitution for the words “Supreme Court” in the definition of “Master” of the words “High Court”, Amendment of section 3 of Act 45 of 1955, as amended by section 2 of Act 65 of 10 1960, section 8 of Act 77 of 1964, section 2 of Act 81 of 1965, section 4 of Act 92 of 1971, section 3 of Act 89 of 1972, section 3 of Act 102 of 1979, section 10 of Act 106 of 1980, section 2 of Act 92 of 1983, section 4 of Act 81 of 1985, section 9 of Act 87 of 1988 and section 7 of Act 97 of 1993

6. Section 3 of the Estate Duty Act, 1955, is hereby amended by the substitution for 15 the proviso to paragraph (a)bis of subsection (3) of the following proviso: “Provided that— (i) this paragraph shall not apply in respect of any annuity [payable] provided by a pension fund, a provident fund or a retirement annuity fund as respectively defined in section 1 of the Income Tax Act, 1962 (Act No. 58 of 1962); 20 (ii) this paragraph shall apply in respect of the commutation of any annuity which on or after the date of the death of the deceased is [payable] provided or may be [payable] provided by a fund referred to in paragraph (i) of this proviso, and that for the purposes of this paragraph any amount payable by way of such a commutation shall be deemed to be a benefit which is due and payable as 25 aforesaid;”. Amendment of section 4 of Act 45 of 1955, as amended by section 2 of Act 59 of 1957, section 3 of Act 65 of 1960, section 9 of Act 71 of 1961, section 9 of Act 77 of 1964, section 3 of Act 81 of 1965, section 2 of Act 94 of 1967, section 5 of Act 92 of 1971, section 2 of Act 70 of 1975, section 1 of Act 104 of 1976, section 4 of Act 102 30 of 1979, section 11 of Act 106 of 1980, section 3 of Act 99 of 1981, section 5 of Act 81 of 1985, section 6 of Act 86 of 1987, section 10 of Act 87 of 1988, section 8 of Act 97 of 1993 and section 3 of Act 20 of 1994 7, Section 4 of the Estate Duty Act, 1955, is hereby amended— (a) by the deletion of the word “or” at the end of subparagraph (iv) of paragraph 35 (h); and (b) by the deletion of subparagraph (v) of paragraph (h). ,., Amendment of section 24 of Act 45 of 1955, as substituted by section 15 of Act 77 of 1962 and amended by section 12 of Act 77 of 1964, section 2 of Act 104 of 1976, section 8 of Act 86 of 1987 and section 10 of Act 97 of 1993 40

8. Section 24 of the Estate Duty Act, 1955, is hereby amended by the substitution for the expression “State President” in subsection (4) of the expression “President”. Amendment of section 26 of Act 45 of 1955, as amended by section 13 of Act 77 of 1964 and section 5 of Act 99 of 1981

9. Section 26 of the Estate Duty Act, 1955, is hereby amended— 45 8 No. 181!3 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 (a) by the substitution for subsections (1) and (2) of the following subsections, respectively: “(1 ) The [State President] National Executive may enter into an agreement with the Government of any other country, [or territory] whereby arrangements are made with such Government with a view to tbe prevention, mitigation or discontinuance of the levying, under the laws of the Republic and of such other country, [or territory] of estate duty in respect of tbe same property or to the rendering of reciprocal assistance in the administration of, and in the collection of estate duty under the laws relating to estate duty in force in the Republic and in such other country [or territory]. (2) As soon as may be after tbe [conclusion] approval by Parliament of any such agreement, as contemplated in section 231 of the Constitution, the arrangements thereby made shall be notified by [proclamation by the State President] publication in the Gazette [whereupon until such proclamation is revoked by the State President] and the arrangements ~ notified [therein shall, so far as they relate to immunity, exemption thereupon or relief in respect of estate duties in the Republic] shall have effect as if enacted in this Act [but only if and for so long as such arrangements, in so far as they relate to immunity, exemption or relief in respect of estate duties levied or leviable in such other country or territory, have the effect of law in such country or territory].”; and (b) by the deletion of subsections (3), (4) and (5). Amendment of section 27 of Act 45 of 1955

10. Section 27 of the Estate Duty Act, 1955, is hereby amended by the substitution for the words “Supreme Court” in subparagraph (ii) of paragraph (b) of subsection (2) of the words “High Court”. Repenl of section 47R o~Act 91 of 1964 11. (1) Section 47B of the Customs and Excise Act, 1964, is hereby repealed. (2) Subsection (1) shall be deemed to have come into operation on 1 July 1997. Substitution of section 49 of Act 91 of 1964, as substituted by section 3 of Act 7 of 1974 ,,

12. The following section is hereby substituted for section 49 of the Customs and Excise Act, 1964: “Agreements in respect of rates of duty lower than the general rates of duty 49, The [State President] National Executive may conclude an agreement with the government of any territory whereby rates of dut y lower than the general rates of duty specified in Part 1 of Schedule No. 1 are on importation into the Republic extended to specific goods produced or manufactured in that territory.”. 5 10 15 20 25 30 35 40 Amendment of section 51 of Act 91 of 1964, as amended by section 7 of Act 57 of 1966, section 1 of Act 89 of 1971, section 5 of Act 103 of 1972 and section 1 of Act 12 of 1977 45

13. Section 51 of tbe Customs and Excise Act, 1964, is hereby amended— (u) by the substitution for the words preceding paragraph (a) of subsection (1) of the following words: “The [State President] National Executive may conclude an agree- ment with tbe government of any territory in Africa in which it is provided that, notwithstanding anything to the contrary in this Act contained—”; and 50 (b) by the substitution for subsection (2) of the following subsection: 10 No. 18113 GOVERNMENT GAZETTE, 4 JULY 1997 Act No. 27, 1997 TAXATION LAWS AMENDMENT ACT, 1997 “(2) Payments made by the government of any territory to the Government of the Republic in terms of any agreement concluded under the provisions of subsection (1) shall accrue to the [State] National Revenue Fund and payments by the Government of the Republic to the government of any territory in terms of any such agreement shall be made as a drawback of revenue as a charge to the [State] National Revenue Fund.”. 5 Amendment of section 58 of Act 91 of 1964, as amended by section 19 of Act 33 of 1974, section 1 of Act 64 of 1974, section 10 of Act 86 of 1982, section 21 of Act 84 of 1987 and section 2 of Act 105 of 1992 10

14. Section 58 of the Customs and Excise Act, 1964, is hereby amended by the substitution for the words “House of Assembly” in subsection (1) of the words “National Assembly”. Amendment of Schedule No. 1 to Act 91 of 1964, as amended by section 19 of Act 95 of 1965, section 15 of Act 57 of 1966, section 2 of Act 96 of 1967, section 22 of Act 85 of 1968, section 37 of Act 105 of 1969, section 9 of Act 98 of 1970, section 2 of Act 89 of 1971, section 12 of Act 103 of 1972, section 6 of Act 68 of 1973, section 3 of Act 64 of 1974, section 13 of Act 71 of 1975, section 13 of Act 105 of 1976, section 38 of Act 112 of 1977, section 3 of Act 114 of 1981, section 27 of Act 86 of 1982, section 10 of Act 89 of 1984, section 14 of Act 101 of 1985, section 11 of Act 69 of 1988, section 19 of Act 68 of 1989, section 40 of Act 59 of 1990, section 3 of Act 111 of 1991, section 15 of Act 105 of 1992, section 13 of Act 98 of 1993, section 12 of Act 19 of 1994, section 74 of Act 45 of 1995 and section 8 of Act 44 of 1996 15. (1) Schedule No. 1 to the Customs and Excise Act, 1964, is hereby amended to the extent set out in the Schedule to this Act. (2) Subject to the provisions of section 58(1) of the Customs and Excise Act, 1964, this section shall be deemed to have come into operation on 12 March 1997, Amendment of section 1 of Act 77 of 1968, as amended by section 16 of Act 103 of 1969, section 5 of Act 66 of 1973, section 7 of Act 88 of 1974, section 19 of Act 106 of 1980, section 3 of Act 118 of 1984, section 17 of Act 87 of 1988, section 36 of Act 9 of 1989, section 3 of Act 69 of 1989, section 5 of Act 136 of 1991 and section 4 of Act 20 of 1994 ., 15 20 25 30

16. Section 1 of the Stamp Duties Act, 1968, is hereby amended by the substitution for the words “Supreme Court” wherever they occur in paragraph (c) of the definition of “authorised revenue officer” of the words “High Court”. 35 Amendment of section 4 of Act 77 of 1968, as amended by section 17 of Act 103 of 1969, section 5 of Act 72 of 1970, section 6 of Act 66 of 1973, section 8 of Act 88 of 1974, section 4 of Act 95 of 1978, section 7 of Act 99 of 1981, section 4 of Act 87 of 1982, section 4 of Act 118 of 1984, section 10 of Act 81 of 1985, section 18 of Act 87 of 1988, section 4 of Act 69 of 1989, section 5 of Act 136 of 1992 and section 13 of Act 97 of 1993 40

17. Section 4 of the Stamp Duties Act, 1968, is hereby amended by the substitution for subparagraph (iii) of paragraph (’ of the following subparagraph: “(iii) any company, society, trust or other association within the Republic which is exempt from tax in terms of section 10(1 )(cF), (cI) g (cJ), [or (cL)] as the case may be, of the said Act,”. 45 Amendment of section 5 of Act 77 of 1968, as amended by section 9 of Act 89 of 1972, section 7 of Act 66 of 1973, section 9 of Act 114 of 1977, section 5 of Act 118 of 1984, section 10 of Act 86 of 1987, section 19 of Act 87 of 1988, section 6 of Act 136 of 1991, section 6 of Act 136 of 1992 and section 12 of Act 37 of 1996 50

18. Section 5 of the Stamp Duties Act, 1968, is hereby amended— (a) by the substitution for paragraph (iii) of the proviso to subsection (1) of the following paragraph: 12 No, 18113 Act No. 27, 1!?)7 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 “(iii) where the Commissioner is satisfied that any person or class of persons cannot conveniently denote the duty in respect of [fixed deposit receipts or installment credit agreements, or in respect of the original issue or the registration of any transfer of marketable securities] ~ instrument in respect of which stamp duty is payable by means of stamps 5 afllxed to such [fixed deposit receipts or to such installment credit agreements or, in the case of the original issue of marketable securities, to such marketable securities or, in the case of the registration of any transfer of marketable securities, to the relevant instrument of transfer referred to in section 23] instrument, he may, 10 subject to such conditions as he may impose and subject to the exercise of such control as he considers necessary, agree that payment of such duty may be acknowledged by means of the issue of a special receipt, and any such [fixed deposit receipt, installment credit agreement, market- able security or instrument of transfer] instrument which bears on its 15 face the words ‘duty paid’, shall for the purposes of this Act be deemed to be duly stamped.”. Amendment of section 23 of Act 77 of 1968, as amended by section 20 of Act 103 of 1969, section 13 of Act 92 of 1971, section 11 of Act 89 of 1972, section 10 of Act 66 of 1973, section 10 of Act 88 of 1974, section 20 of Act 106 of 1980, section 6 of Act 20 87 of 1982, section 5 of Act 92 of 1983, section 25 of Act 87 of 1988, section 8 of Act 69 of 1989, section 81 of Act 89 of 1991, section 7 of Act 136 of 1991 and section 13 of Act 37 of 1996 19. (1) Section 23 of the Stamp Duties Act, 1968, is hereby amended— (a) by the deletion in subsection (1) of the definition of “arbitrage transaction”; 25 (b) by the deletion of subparagraphs (vii) and (viiA) of paragraph (b) of subsection (4); (c) by the substitution for subsection (5) of the following subsection: “(5) No endorsement shall be mfide by any broker or honk for (he purposes of subsection (4)(b)(ii), (v) or (vi) [or (vii)] unless the 30 transferee’s name appears in the relevant~nstrument of transfer.”; and (d) by the substitution for paragraph (b) of subsection (8) of the following paragraph: “(b) makes any endorsement on any instrument of transfer for the purposes of subsection (4)(b) (ii), (v), (vi) [(vii), (viiA)] or (viiB) which is false or 35 incorrect or fails to comply with the provisions of subsection (5); or”. (2) Subsection (1) shall be deemed to have come into operation on 1 July 1997 and shall apply in respect of the registration of transfer of any marketable security on or after that date. Amendment of section 30 of Act 77 of 1968, as amended by section 15 of Act 97 of 40 1993

20. Section 30 of the Stamp Duties Act, 1968, is hereby amended by the substitution for the words “Supreme Court” in paragraph (b) of subsection (1) of the words “High Court”. 14 No, 18113 Act No. 27.1997 GOVERNMENT GAZE’ITE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 Amendment of Item 15 of Schedule 1 to Act 77 of 1968, as substituted by section 13 of Act 89 of 1972 and amended by section 16 of Act 66 of 1973, section 21 of Act 88 of 1974, section 3 of Act 104 of 1976, section 20 of Act 114 of 1977, section 8 of Act 95 of 1978, section 8 of Act 102 of 1979, section 21 of Act 106 of 1980, section 9 of Act 99 of 1981, section 7 of Act 87 of 1982, section 14 of Act 92 of 1983, section 11 5 of Act 118 of 1984, section 11 of Act 81 of 1985, section 5 of Act 71 of 1986, section 13 of Act 108 of 1986, section 11 of Act 86 of 1987, section 33 of Act 87 of 1988, section 14 of Act 69 of 1989, section 83 of Act 89 of 1991, section 9 of Act 136 of 1991, section 8 of Act 136 of 1992, section 17 of Act 97 of 1993, section 17 of Act 140 of 1993, section 8 of Act 20 of 1994 and section 17 of Act 37 of 1996 10 21.( 1) Item 15 of Schedule 1 to the Stamp Duties Act, 1968, is hereby amended— (a) by the substitution in subparagraph (g) of paragraph (3) for the words preceding subparagraph (i) of the following words: ‘fif the marketable security was sold or disposed of (whether conditionally or not) after 31 March 1996 but not later than 31 March 1997 and the date of the sale or disposal is noted on the relevant instru- ment of transfer referred to in section 23 of this Act by the transferee or his agent and such note is signed by the transferee or his agent:”; (b) by the addition to paragraph (3) of the following subparagraph: “(h) in any other case— (i) if transfer— (au) other than a transfer contemplated in subparagraph (bb), is registered before the expiry of a period of six months; or (bb) is registered in the name of a broker, or the nominee of a broker and is so registered before the expiry of a period of three months, from the date of execution of the relevant instrument of transfer referred to in scc[ion 23 of this Act: for every R 10, or part thcrvof, of the amount or value of the consideration given or, where no consideration is given or the consideration given is less than the value of the marketable security transfemed, of the value of the marketable security trans- ferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (ii) if transfer— (aa) is registered after the expiry of the period of six months referred to in subparagraph (i)(aa); or o 025 (bb) is registered in the name of a broker, or the nominee of a broker, after the expiry of the period of three months referred to in subparagraph (i)(bb) . . . . . . . . . . . . . . . . . . . . . . . . . .. Three times the duty which would have been payable under (h)(i) if transfer had been registered be- fore the expiry of the said period of six or three months, as the case may be.”; (c) by the deletion of subparagraphs (n) and (nA) of the “E.t-emptions from the duty under purugruph (3)”; (d) by the substitution in paragraph (4) for the amount “O 05” in the column “Amount of Duty” of the amount “O 025”; and (e) by the substitution for subparagraphs (vi) and (vii) of paragraph (5) of the following subparagraphs: 15 20 25 30 35 40 15 $0 55 }6 No, 18113 Act No. 27, 1997 GOVERNMENT GAZE’ITE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 “(vi) if the date of acquisition of such marketable security falls on or after 1 April 1996 but not later than 31 March 1997 and the relevant deed or declaration referred to in section 23(15) of this Act is duly stamped before the expiry of a period of six months from the date of such acquisition: for every R 10, or part thereof, of the amount or value of the consideration given or, where no consideration is given or the consideration given is less than the value of the marketable security transferred, of the value of the marketable security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . [vii) if the ‘date of acquisition of such marketable security falls on or after 1 Amil 1997 and the relevant deed or declaration referred to in section 23( 15) of this Act is duly stamped before the expiry of a period of six months from the date of such acquisition: for every R1O, or part thereof, of the amount or value of the consideration given or, where no consideration is given or the consider- ation given is less than the value of the marketable security transferred, of the value of the marketable security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . [(vii)] ~ if the relevant deed or declaration is not duly . 0 05 0025 stamped within the period of six months referred to in subparagraph (i), (ii), (iii), (iv), (v), [or] (vi) -j as the case maybe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. Three times the duty which would have been payable under (i), (ii), (iii), (iv), (v), [or] (vi) or (vii) (whichever is applic- able), if the deed or declaration had been duly stamped within the period of six months referred to in subparagraph (i), (ii), (iii), (iv), (v), [or] (vi) or (vii), as the case may be.”. (2) (a) Subsection (1)(a), (b), (d) and (e) shall be deemed to have come into operation on 1 April 1997; (b) Subsection (1)(c) shall be deemed to have come into operation on 1 July 1997. Repeal of section 44 of Act 59 of 1990 22. (1) Section 44 of the Customs and Excise Amendment Act, 1990, is hereby repeal ed. (2) Subsection (1) shall be deemed to have come into operation on 10 July 1990. 5 10 1 15 20 25 30 35 40 45 18 No, 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 Amendment of section 1 of Act 89 of 1991, as amended by section 21 of Act 136 of 1991, section 1 of Government Notice 2695 of 8 November 1991, section 12 of Act 136 of 1992, section 22 of Act 97 of 1993, section 9 of Act 20 of 1994 and section 18 of Act 37 of 1996 23. (1) Section 1 of the Value-Added Tax Act, 199 I (hereinafter referred to as the 5 principal Act), is hereby amended— (cl) by the substitution for paragraph (b) of the definition of “association not for gain” of tbe following paragraph: “(b) any other society, association or organization, whether incorporated or not (other than an educational institution in respect of which the provisions of paragraph (c) apply), which— (i) is carried on otherwise than for the purposes of profit or gain to any proprietor, member or shareholder; and (ii) is, in terms of its memorandum, articles of association, written rules or other document constituting or governing the activities of that society, association or organisation— f@ required to utilize any property or income solely in the (MJ (cc) furtherance of its aims and objects; and [is] prohibited from transferring any portion thereof directly or indirectly in any manner whatsoever so as to profit any person other than by way of the payment in good faith of reasonable remuneration to any ofticer or employee of tbe society, association or organization for any services actualIy rendered to such society, association or organization; and upon the winding-up or liquidation of such society, association or organization, [it will be] obliged to give or transfer its assets remaining after tbe satisfaction of its liabilities to some other society, association or organization with objects similar to those of the said society, association or organization; or”; 10 15 20 25 (h) by the addition O( t h e f o l l o w i n g paragriiph to Ihe silid delin”fiwl ol 30 “association not for gil in”: “(c) any educational institution of a public character, whether incorporated or not, which— (i) is carried on otherwise than for the purposes of profit or gain to any proprietor, member or shareholder; and (ii) is, in terms of its memorandum, articles of association, written rules or other document constituting or governing the activities of that educational institution— (au) required to utilize any property or income solely in the furtherance of its aims and objects; and 35 40 (W) prohibited from transferring any portion thereof directly or indirectly in any manner whatsoever so as to profit any person other than by way of tbe payment in good faith of reasonable remuneration to any officer or employee of the educational institution for any services actually rendered to such institu- 45 tioJl; ” ; (c) by tbe addition of the word “or” at the end of paragraph (f) of tbe definition of “connected persons”; (d) by the addition of the following paragraph to the definition of “connected persons”: “ ) any person and any superannuation scheme referred to in section 2(2)( vii), the members of which are mainly the employees or ohlice holders or former employees or otlice holders of that person;”; (e) by the insertion iifter subparagraph (iii) of paragraph (b) ot’ the definition of “enterprise” of the following subparagraph: “(iv) the activities of any p erson who continuously or regularly supplies telecommunication services to any person wbo utilizes such services in tbe Republic;”; 50 55 (j) by the substitution in the definition of “input tax” for the words preceding tbe proviso to paragraph (b) of the following words: “an amount equal to the tax fraction (being the tax fraction applicable at the time [of payment] the supply is deemed to have taken place) of the lesser of 60 20 No. 18113 GOVERNMENT GAZETTE, 4 JULY 1997 Act No. 27, 1!)97 TAXATION LAWS AMENDMENT ACT, 1997 (t?) (h) any consideration in money given by the vendor for or the open market value of the supply (not being a taxable supply) to him by way of a sale on or after the commencement date by a resident of the Republic of any second-hand goods situated in the Republic:”; by the substitution for the definition of “transfer payment” of the following 5 definition: “ ‘transfer payment’ means a transfer payment as contemplated in paragraph [A2.9] 1,2.9.3 of the Manual on the Financial Planning and Budgeting System of the State published in terms of section 39 of the Exchequer Act, 1975 (Act No. 66 of 1975);”; and by the substitution for the proviso to the definition of “vendor” of the following proviso: “Provided that where the Commissioner has under section 23 or 50A determined the date from which a person is a vendor that person shall be deemed to be a vendor from that date;”. 15 10 (2) The provisions of subsection (1)(e) shall come into operation on a date fixed by the President by proclamation in the Gazette. Amendment of section 2 of Act 89 of 1991, as amended by section 22 of Act 136 of 1991, section 2 of Government Notice 2695 of 8 November 1991, section 13 of Act 136 of 1992, section 10 of Act 20 of 1994 and section 19 of Act 37 of 1996 20

24. Section 2 of the principal Act is hereby amended by the substitution for paragraph (a) of subsection (4) of the following paragraph: “(a) the cession, assignment, [or other] transfer or other supply of any right to receive payment in relation to any taxable supply where, as a result of any such cession, assignment, [or] transfer or supply, output tax in relation to that 25 taxable supply would not be or become attributable to any tax period for the purposes of section 16(3); or”. Amendment of section 8 of Act 89 of 1991, as amended by section 24 of Act 136 of 1991, section 4 of Government Notice 2695 of 8 November 1991, section 15 of Act 136 of 1992, section 24 of Act 97 of 1993, section 11 of Act 20 of 1994 and section 20 30 of Act 46 of 1996

25. Section 8 of the principal Act is hereby amended by the addition of the following subsection: “(20) For the purposes of this Act, where an importation of goods is deemed to have been made by an agent in the circumstances contemplated in section 35 54(2 A)(b), such agent shall be deemed to make a supply of goods to the recipient of the supply by the principal, as contemplated in subparagraph (iii) of that section.”. Amendment of section 9 of Act 89 of 1991, as amended by section 25 of Act 136 of 1991, section 25 of Act 97 of 1993 and section 21 of Act 46 of 1996 40

26. Section 9 of the principal Act is hereby amended by the addition of the following subsection: “(9) Where any supply of goods is deemed to be made as contemplated in section 8(20), that supply shall be deemed to take place at the time the tax payable on importation of the goods is paid by the agent.”. 45 22 No. 18113 Act No. 27.1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 Amendment of section 10 of Act 89 of 1991, as amended by section 26 of Act 136 of 1991, section 5 of Government Notice 2695 of 8 November 1991, section 16 of Act 136 of 1992, section 26 of Act 97 of 1993, section 12 of Act 20 of 1994, section 21 of Act 37 of 1996 and section 22 of Act 46 of 1996

27. Section 10 of the principal Act is hereby amended— (a) by the substitution in subsection (9) for the words preceding the proviso to the paragraph defining the meaning of the symbol “C” of the following words: “represents the percentage that, during the 12 month period during which the decrease in use or application of the goods or services is deemed to take place, the use or application of the goods or services for the purposes of making taxable supplies (in respect of which, if such goods or services had been acquired at the time of such use or application, a deduction of input tax would not have been denied in terms of section 17(2)(a)), was of the total use or application of the goods:”; and (b) bv the insertion after subsection (22A) of the following subsection: !,, “(22B) Where any supply of goods”is deemed to be &ade as contemplated in section 8(20), the consideration in money for such supply shall be deemed to be the total amount of the value placed on the importation of the goods in terms of section 13(2) and the amount of tax levied on the importation in terms of section 7(1 )(bj.’; . Amendment of section 11 of Act 89 of 1991, as amended by section 27 of Act 136 of 1991, section 6 of Government Notice 2695 of 8 November 1991, section 17 of Act 136 of 1992, section 27 of Act 97 of 1993 and section 13 of Act 20 of 1994

28. Section 11 of the principal Act is hereby amended— (a) (b) (c) (d) by the substitution in subsection (1) for the words preceding paragraph (a) of the following words: “Where, but for [the provisions ofl this section, a supply of goods would be charged with tax [under section 7(1 )(a)] at the rate referred to in section 7(I), such supply of goods shall, subject to cornpliimce with subsection (3) of this section, be charged with tax at the rate of zero per cent where—”; by the substitution in subsection (2) for the words preceding paragraph (a) of the following words: “Where, but for this section, a supply of services would be charged with tax [under section 7(l)(a)] at the rate referred to in section 7(l), such supply of services shall, subject to compliance with subsection (3) of this section, be charged with tax at the rate of zero per cent where—”; by the substitution for paragraph (k) of the said subsection (2) of the following paragraph: “(k) the services are physically rendered elsewhere than in the Republic, !_@ being telecommunication services supplied to any person who utilizes such services in the Republic; or”; and by the substitution in paragraph (1) of the said subsection (2) for the words preceding subparagraph (i) of the following words: “the services are supplied for the benefit of and contractually to a person who is not a resident of the Republic and who is outside the Republic at the time the services are rendered, not being services which are supplied directly in connection with—”. Amendment of section 12 of Act 89 of 1991, as amended by section 28 of Act 136 of 1991, section 7 of Government Notice 2695 of 8 November 1991, section 18 of Act 136 of 1992, section 28 of Act 97 of 1993, section 14 of Act 20 of 1994 and section 22 of Act 37 of 1996

29. Section 12 of the principal Act is hereby amended by the substitution for paragraph (g) of the following paragraph: 5 10 15 20 25 30 35 40 45 50 24 N o . 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 ‘((g) the supply by any person in the course of a transport business of any service comprising the transport by that person in a vehicle operated by him of fare-paying passengers and their personal effects by road or railway (exciuding-a Iunicul;r railway), not b~ing a supply of any-such service which, but for this paragraph, would be charged with tax at the mte of zero per cent under section 11 (2)(a);”. Amendment of section 13 of Act 89 of 1991, as amended by section 29 of Act 136 of 1991, section 19 of Act 136 of 1992, section 29 of Act 97 of 1993 and section 15 of Act 20 of 1994

30. Section 13 of the principal Act is hereby amended— (a) bv the substitution for subsection (1) of the followirw subsection: . Q!) “(1 ) For the purposes of this Act ~oods shall be deemed to be imported into the Republic o; the date on which tie goods are in terms of section 10 of the Customs and Excise Act deemed to be imported: Provided that— (Q goods which are entered for home consumption in terms of the Customs and Excise Act, shall be deemed to have been imported on the date on which they are so entered; [Provided further that] where any goods have been imported and entered into a licensed Customs and Excise warehouse but have not been entered for home consumption, any supply of such goods before they are entered for home consumption shall be disregarded for the purposes of this Act; [Provided further that] goods imported from Botswana, Lesotho, Swaziland and Namibia shall be declared and tax paid to an officer designated by the Commissioner for Customs and Excise on entry into the Republic in accordance with such procedures and at such place as the said Commissioner may prescribe by rule.”; (i!.!) 5 10 15 20 25 (c) (d) (e) by the addition of the following proviso to subsection (2): “Provided that where the Minister has mide a regulation determining lhe_ Vill U(3 (d’ such goods Ior Ihe purposes of Ibis section, the greater 0( such 30 determined value or the value declared on importation shall be used instead of the value for customs purposes.”; by the substitution in subsection (4) for the words preceding paragraph (a) of the following words: “Where tax is payable in respect of the importation of goods into the Republic and such goods are [not entered and will] not [require] required to be entered [for home consumption] in terms of the Customs and Excise Act and tax has not been paid to the Commissioner for Customs and Excise when the goods were imported the importer shall within 30 days after the importation of the goods—”; by the substitution for the proviso to the said subsection (4) of the following proviso: “Provided that this subsection shall not apply in respect of the importation (other than the importation of any motor vehicle) by a vendor in the circumstances contemplated in this subsection, if the tax payabIe would be allowable as a deduction in terms of section 16(3)(a)(iii) or section 16(3)(b)(ii) [except if provided otherwise in any regulation made by the Minister under section 74].”; and by the substitution for subsection (6) of the following subsection: 45 35 40 “(6) Subject to the provisions of [this Actl section 7(1 )(b) and this section, the provisions of the Customs and Excise Act [relating to the importation, transit, coastwise carriage and clearance of goods and the payment and recovery of duty] shall “nt[/((/(i,t mrffandis apply as if enilcted in this Act, whether or not the said provisions apply for the purposes of any duty levied in terms of the Customs and Excise Act.”. 50 55 26 No, 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 Amendment of section 15 of Act 89 of 1991, as amended by section 8 of Government Notice 2695 of 8 November 1991 and section 20 of Act 136 of 1992

31. Section 15 of the principal Act is hereby amended— ((l) (b) (c) (d) by the substitution in subsection (2) ‘for the words preceding paragraph (a) of the following words: “Subject to the provisions of (suhsectionl subsections (2A) and (3), the Commissioner may, on application in writing by a vendor, direct that the vendor account for the tax payable on a payments basis for the purposes of section 16 with effect from the vendor’s registration in terms of this Act or, where he has accounted for tax payable on an invoice basis prior to making an 10 application under this subsection, from the commencement of the tax period immediately following the tax period during which that direction is made by the Commissioner (hereinafter referred to as the changeover period), if—”; by the insertion after the said subsection (2) of the following subsection: 5 “(2A) Any vendor (other than a public authority or local authority) who in 15 terms of subsection (2) accounts for tax payable on a payments basis shalI, in respect of any supply made on or after 5 June 1997 of goods (other than fixed property) or services in respect of which the consideration in money is R 100000 or more, account for the tax payable on an invoice basis.”; by the substitution in subsection (3) for the words following upon paragraph (b) and preceding the proviso of the following words: “the Commissioner shall direct that the vendor account for the tax payable on an invoice basis with effect from the commencement of a future tax period [approved] or, where the vendor has failed to notify the Commissioner that he has ceased to satisfy the conditions of subsection (2), as required by the said section 25(c), any tax period directed by the Commissioner [(hereinafter referred to as the changeover period)]:”; and by the substitution for subsection (5) of the following subsection: “(5) Any vendor to whom subsection (4) applies shall, within the time allowed under this Act for the payment of tax in respect of the tax period immediately preceding the changeover period, pay to the Commissioner the tax payable as calculated in accordance with this section.”. 20 25 30 Amendment of section 16 of Act 89 of 1991, as amended by section 30 of Act 136 of 1991, section 21 of Act 136 of 1992, section 30 of Act 97 of 1993, section 16 of Act 20 of 1994 and section 23 of Act 37 of 1996 35

32. Section 16 of the principal Act is hereby amended— (a) by tbe substitution for subparagraphs (ii) and (iiA) of paragraph (a) of subsection (3) of the following subparagraphs, respectively: “(ii) (2@ in respect of supplies of second-hand goods to which paragraph (b) of the definition of ‘input tax’ in section 1 applies (other than supplies in respect of which the provisions of subparagraph (bb) apply), to the extent that payment of any consideration which has the effect of reducing or discharging any obligation (whether an existing obligation or an obligation which will arise in the future) relating to the purchase price for those supplies has been made during that tax period; [Provided that where such] 40 45 ~ in respect of supp lies of second-hand goods to which paragraph (b) of the definition of ‘input tax’ in section 1 applies which consist of— [(aa)]~ fixed property in respect of the acquisition of which transfer 50 duty is, in terms of the Transfer Duty Act, payable; or [@b)]@ a share in a share block company in respect of the original issue or registration of transfer of which stamp duty is, in terms ‘of the Stamp Duties Act, payable, 28 No. 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 [such input tax shall be deducted only after] if the full or final amount of such transfer duty or stamp duty, as the case may be, has been paid during that tax period; (iiA) in respect of taxable supplies made to the vendor under sales concluded on or after 6 June 1996 in respect of which the provisions of section 5 9(3)(d) apply [other than supp lies in respect of which the provisions of section I ()(4) apply), to the extent that payment of any consideration which has the effect of reducing or discharging any obligation (whether an existing obligation or an obligation which will arise in the future) relating to the purchase price for those supplies has been made during 10 that tax period;”; (b) by the substitution for subparagraph (v) of paragraph (a) of the said subsection (3) of the following subparagraph: “(v) calculated in accordance with section 21(2)(b) or 21(7) or section 22(l), 22(1 A) or 22(4), as applicable to the vendor;”; (c) by the insertion after paragraph (i) of the said subsection (3) of the following paragraph: “O) (i) in the case of a vendor who has, during the tax period, supplied t property in possession in the course or furtherance of his enterprise ~nder a-sale, an amount equal to the tax fraction of the lesser ‘of— the amount (excluding any amount of tax) received in respecl (au) of the sale of such property in possession less any amount paid by the vendor in respect of the acquisition of such property in possession; and the amount of the unrecovered loan balance less any amount paid by the vendor in respect of the acquisition of such property in possession: (bb) I Provided that no deduction shall be made in terms of this paragraph where the person in default is or will be held liable for payment of such lesser amount; for the purposes of t h i s p a r a g r a p h— (an) ‘property in possession’ means fixed property acquired by any (ii) vendor— (A) at a sale in execution as a result of default by any person (other than a person who held or applied such fixed property for the purpose of making taxable supplies in the course or furtherance of his’ enterprise immediately before such sale in execution) in respect of an unrecovered loan balance due to that vendor in terms of a credit agreement; or as a result of an abandonment authorised by the Master of the High Court where such person has defaulted in respect of an unrecovered loan balance due to that vendor in terms of a credit agreement or gone insolvent; (B) (bb) ‘unrecovered loan balance’ means the amount of capital, interest and administrative holding costs outstanding in terms of a credit agreement at the date of sale in execution or the date of authorisation of abandonment by the Master of the High Court:”; and 15 20 25 30 35 40 45 (d) by the substitution for subparagraph (ii) of paragraph (a) of subsection (4) of 50 the following subparagraph: “(ii) where a“supp”l y is-made under a sale concluded on or after 6 June 1996 in respect of which the provisions of section 9(3)(d) apply (other than a supply in respect of which the provisions of section 10(4) apply), to the extent that payment of any consideration which has the ell’ect of reducing or discharging any obligation (whether an existing obligation or an obligation which will arise in the future) relating to the purchase price for that supply has been made during that tax period; or”. 55 30 No. 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 Amendment of section 17 of Act 89 of 1991, as amended by section 31 of Act 136 of 1991, section 9 of Government Notice 2695 of 8 November 1991, section 22 of Act 136 of 1992, section 31 of Act 97 of 1993 and section 17 of Act 20 of 1994

33. Section 17 of the principal Act is hereby amended— (a) by the substitution for paragraphs (i) and (ii) of the proviso to paragraph (a) of 5 subsection (2) of the following paragraphs, respectively: “(i) such goods or services are acquired by the vendor [wholly or mainly] for making taxable supplies of entertainment in the ordinary course of an enterprise which— M continuously or regularIy supplies entertainment to clients or customers (other than in the circumstances contemplated in subparagraph (bb)) for a consideration [and for which supply of entertainment a charge which covers the cost of such entertain- ment is made by such vendor to the recipient] to the extent thal such taxable supplies of entertainment are made for a charge which— (A) covers all direct and indirect costs of such entertainment; or (B) is equal to the open market value of such supply of entertainment, unless— (i) (ii) such costs or open market value is for bona jide promotion purposes not charged by the vendor in respect of the supply tc recipients who are clients or customers in the ordinary course of the enterprise, of entertainment which is in all respects similar to the entertainment continuously or regularly supplied to clients or customers for consideration; or the goods or services were acquired by the vendor for purposes of making taxable supplies ~o such- clients or customers of entertainment which consists of the provision of any food and a supply of any portion of such food is subsequently made to any employee of the vendor or to ilny welfare organ iziltion as all such food was not consumed in the course of making such taxable supplies; (bb) supplies entertainment to any employee or office holder of the vendor or any connected person in relation to the vendor, to the extent that such taxable supplies of entertainment are made for a charge which covers all direct and indirect costs of such entertain- ment; 10 15 20 25 N-1 35 (ii) such goods or services are acquired by the vendor for the consumption or enjoyment by that vendor (including, where the vendor is a partnership, a member of such partnership) or an employee or office holder of such vendor in respect of personal subsistence in respect of any night that such vendor or member is by reason of the vendor’s enterprise or, in the case of such employee or office holder, he is by reason of the duties of his employment or office, obliged to spend away from his usual place of 45 residence and, in respect of an absence on or after [the date of promulgation of the Taxation Laws Amendment Act, 1992] 15 July ~, from his usual working-place;”; and $0 (b) by the addition of the following subsection: “(4) Where, but for the provisions of this subsection, an amount qualifies or 50 has qualified for a deduction under more than one provision of this Act, a deduction of such amount, or any portion thereof, shall not be made more than once in the calculation of the amount of tax payable by any person.”. Amendment of section 18 of Act 89 of 1991, as amended by section 32 of Act 136 of 1991, section 23 of Act 136 of 1992, section 32 of Act 97 of 1993 and section 18 of Act 55 20 of 1994

34. Section 18 of the principal Act is hereby amended— 32 No. 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 (a) (b) (c) (d) (e) by the substitution in subsection (1) for the words following upon paragraph (c) of the following words: “([not being] excluding goods or services to the extent that, in respect of the acquisition of which by the vendor, a deduction of input tax was denied by section 17(2) or would have been denied if that section had been applicable prior to the commencement date) and such goods or services were acquired, manufactured, assembled, constructed or produced by such vendor wholly or partly for the puqmse of consumption, use or supply in the course of making taxable supplies or such goods were held or applied for that purpose, such goods or services shaIl— Q if they are subsequently applied by him (otherwise than in the circumstances contemplated in section 8(9)) wholly for a purpose other than the said purpose; E (ii) if they are subsequently applied by him wholly for a purpose in respect of which, if such goods or services had been acquired by him at the time of such application, a deduction of input tax would have been denied in terms of section 17(2)(a) or (c), be deemed to have been supplied by him by way of a taxable supply by him in the course of his enterprise.”; by the substitution in subsection (2) for the words following upon paragraph (c) and preceding the proviso of the following words: “([not being] excluding goods or services to the extent that, in respect of the acquisition of which by the vendor, a deduction of input tax was denied by section 17(2) or would have been denied if that section had been applicable prior to the commencement date) and such goods or services were acquired, manufactured, assembled, constructed or produced by such vendor wholly or partly for the purpose of consumption, use or supply in the course of making taxable supplies or such goods were held or applied for that purpose, such goods or services shall, if the extent of the application or use of such goods or services in the course of making taxable suppIies (in respect of which, if such goods or services had been acquired at the time of such application or use, il deduction of input tax would not have been denied in terms of section 17(2)(a)) is subsequently reduced in relation to their total application or use, be deemed to have been supplied by him by way of a taxable supply by him in the course of his enterprise at the time at which such reduction is deemed by subsection (6) to take place:”; by the substitution in subsection (4) for the words in paragraph (a) following upon subparagraph (ii) of the following words: “[(not being goods or services in respect of the acquisition of which by a person a deduction of input tax would have been denied by section 17(2) if that section had been applicable prior to the commencement date)] and such goods or services were acquired, manufactured, assembled, constructed or produced or applied by such person wholly for purposes other than that of consumption, use or supply in the course of making supplies in the course of an activity which was an enterprise or would have been an enterprise if section 1 had been applicable prior to the date of promulgation of this Act or for a purpose in respect of which a deduction of input tax in respect of such goods or services would have been denied in terms of section 17(2) if that section had been applicable prior to the commencement date; or”; by the substitution in the said subsection (4) for the words in paragraph (b) following upon subparagraph (iii) of the following words: “[(not being goods or services in respect of the acquisition of which by a person a deduction of input tax was denied by section 17(2) or would have been denied by that section if that person bad been a vendor)] and no deduction has been made in terms of section 16(3) in respect of or in reli]tion to such goods or services; or” by the substitution in subsection (4) for the words following upon paragraph (c) and preceding the formula of the following words: “such goods or services are subsequent to the commencement date applied in 5 10 15 20 25 30 35 40 45 50 55 34 N(I, 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAX.KrI(~N LAWS AMENDMENT ACT, 1997 any tax period by that person or, where he is a member of a partnership, by the partnership, wholly or partly for consumption, use or supply in the course of making taxable supplies (other than taxable su pplies in respect of which, if such goods or services had been acquired at the time of such application, a deduction of input tax would have been denied in terms of section 17(2)), those goods or services shall be deemed to be supplied in that tax period to that person or (he partnership, :1s lbc case may bc, and the Commissioner shall aliow that person or the partnership, as (he C:ISC Inay be, to make a dcducti(m in terms o! section 16(3) of an amount determined in accordance with the formula”; by the substitution for the paragraph in the said subsection (4) defining the meaning of the symbol “C” of the following paragraph: “ ‘C’ represents the ratio that, immediately after the supply so deemed to be made, the intended use of the goods or services (as contemplated in section 17( 1)) in the course of making taxable supplies (other than taxable supplies in respect of which, if such goods or services had been acquired at the time of such application, a deduction of input tax would have been denied in terms of section 17(2)) bears to the total intended use of those goods or services, expressed as a percentage: Provided that where the intended use of goods or services in the course of making taxable supplies (other than taxable supplies in respect of which, if such goods or services had been acquired at the time of such application, a deduction of input tax would have been denied in terms of section 17(2)) is equal to not less than 90 per cent of the total intended use of such goods or services, such percentage shall be deemed to be 100 per cent; and”; by the substitution for the words following upon paragraph (c) of subsection (5) and preceding the formula of the following words: “’[(not being goods or services in respect of the acquisition of which by the vendor a deduction of input tax was denied by section 17(2) or would have been denied if that section had been applicable prior to the comnmnce- mcnt date)] and such g(wls or services were ilCqU i red, manu(act ured, assembled. constructed or produced or ilpplied by such vendor partly for the purpose of consumption, use or supply in the course of making taxable supplies (other that) taxable supp lies in respect of which, if such goods or services had been acquired at the time of such application, a deduction of input tax would have been denied in terms of section 17(2)) or of making supplies in the course of an activity which was an enterprise or would have been an enterprise if section 1 had been applicable prior to the date of promulgation of this Act (other than su pplies in respect of which, if such ~oods or services had been acquired at the time of such application, a deduction of input tax would have been denied in terms of section 17(2) if that section had been applicable prior to the commencement date) suck~ goods or services shall, if the extent of the application or the use of such goods or services in the course of making taxable supplies (other than taxable supp lies in respect of which, if such goods or services had been acquired at the time of such application, a deduction of input tax would have been denied in terms of section 17(2)) is subsequent to the commencement date increased in relation to their total application or use, be deemed to be supplied to him, and the Commissioner shall allow the vendor to make a deduction in terms of section 16(3), in the tax period during which such increase is deemed by subsection (6) to take place, of an amount determined in accordance with the formula”; by the substitution in the said subsection (5) for the words preceding the proviso to the paragraph defining the meiming of the symbol “C” of the following words: “represents d~e percentage that, during the 12 month period during which the increase in use or application of the goods or services is deemed to take place, 5 10 15 20 25 30 35 40 45 50 55 (f) (f?) (},) .3() N,,. 1S113 ,\(’t No. 27, 1997 GOV13{NMIiN’I GAZETTE 4 JULY 1997 TAXAi_lON LAWS AMENDMENr ACT, 1997 the use or application of the .zoods or services for the purposes of making taxable suppl{es (other than tax~~ble supplies in respect of which, if such good; or services haLI been acquired at the time of such application, a deduction of il~pu( tax WOUILI have been ~cnied in terms of section 17(2)) was of the totti} ~se or application of the goods:”; (i) by IIW subs[i[ution for (Iw p:~r:igraptl it] IIIC said subsection (5) dclining the ‘(l)” (II’ IIIC I’(,ll(}witlg [I: II: Igt-:lllll: Ilw:li]i[]g of [l IL’ SyIIIINIl “ ‘1)’ rcprcscnls [IIC [)crccIItagc 111:11 [IIC u s c (w al]l)lica[iol} (JI’ [Iw g(wds or scrviccs I’(II” Illc puqmscs (II’ in:lkin~ Mxablc supplies (otllcr (Il:ln [oxablc it’ such goods or services had been yylics i n rcspcc[ 01 which. acqui l-cd at tlm ti[ne 01 such application, a dcduc~ion ot” inpul lox w(mlJ have been denied in t&mls of scctioo 17(2)) was of the tolal usc ol- application of such goods or services determined in terms of section 17( 1). sec[ion 10(9) or sLibscc[ion (4) of (his sccticm or this subsection, whichever wus ;q)plicablc in the period immmliately preceding the 12 month period contemplated in ‘C’:”; and (i) bY the addition to tile said subsection (5) of the following proviso: “P1’OViLkd further that where sLlcll goods or services consist of’ second-hand ~oods c~)nten]p]:lt~~ in tile proviso 10 p:lragrapll (l)) of the definition ot’ ‘input tax’ in section 1, the amount determined in terms of this subsection shall not exceed tlIc amount of transfer duty or stamp duty. as the ctisc may lx, which is or would have been pyable, lCSS any amount which has previously been deducted in terms of the provisions ot’ section 16(3) ([~)(ii) or (h)(i), or subsection (4) of this section, in respect or such acquisition, original issLle or re~istration of transfer, as the case may be.”. Amendment of section 20 of Act 89 of 1991, as amended by section 11 of Government Notice 2695 of 8 November 1991, section 25 of Act 136 of 1992 and section 33 of Act 97 of 1993

35. Sccli(~il 20 (~1’ tlw Iwillcil)al Act is llcILsl)y :IIIICIKILXI Ily IIIC sul)sli[tlli(ul l“~)r paragraph (~~) 01” sL]bseclioll (8) 01 the I’bllowil)g pal-agraph: “(a) @ The name of the Sllpplier anLl- (,w) where the supplier is a natLmd person, his identity number; or (bb) where the supplier is not a natLu4 person, the name and identity number of the natural person representing the supplier in respect of the sLIpply anLI any legally :iilocated registration number of the supplier: Provided that the recipient- shall verily such name anLI identity number of any such natural person with refel-ence to his identity document, as contemplated in section 1 of the Identification Act, 1986 (Act No. 72 of 1986), and, where the vulue of the supply is R ] 000” or more, retain a photocopy of such nanle anLI identity number appearing in such identity document; or shall verify such name and registrat iLm number of any supplier other than a natural person with reference to its bLlsiness letterhead or other similar document and, where the value of the SLIP})]Y is RI t)~~ or more, retain u pl:otocopy of such name and registration number appearing on such letterhead or document; and (B) @ @ address of the supplier;” 5 1() 15 20 25 3U 35 40 45 Amendment ol sec(iou 22 of Act W of 1991, as amended by section 33 of Act 136 of 50 1991. sect i~)~t 1.} {)1’ (;()~crillnellt N{d icc 2095 of 8 Novcll)lwr 1991, ,swlifMI 27 ~JAct 1.100119°2 nnd sc’c(io[l 25 (JI /\ct .17 {d’ I(W6 36. sec[i~)n 22 (It’ tlw pcincipal Act is hcwby aIncndcd- 38 No, 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 (a) by the addition to the first proviso to subsection (1) of the following paragraph: “(iv) a vendor who has transferred an account receivable at face value cm a— (aa) non-recourse basis to any other person, shall not make any deduction in respect of such transfer in terms of this subsection; or (bb) recourse busis (o any other person, may make a deduction in terms of this subsection only when such accoul)t receivable is (ranslcrrd back to him and hc has written ON so much of the consideration M has bccomc irrecovcrablc:”; 5 (b) by the insertion after the said subsection (1) 01 the following subsection: 10 “( 1A) Where a vendor— (a) has made a taxable supply for consideration in money; and (b) has furnished a return in respect of the tax period for which the output tax on the supply was payable (at the rate of tax referred to in section 7(1)) and has properly accounted for the output tax on that supply as required in terms of this Act; and (c) has transferred the account receivable relating to such taxable supply at face value to another vendor (hereinafter referred to as the recipient) on a non-recourse basis on or after the date of promulgation of the Taxation Laws Amendment Act, 1997, and any amount of the face value (excluding any amount of finance charges or collection costs) of such account receivable has been written off as irrecoverable by such recipient, such recipient may make a deduction in terms of section 16(3) of an amount equal to the tax fraction (being the tax fraction applicable at the time such taxable supply is deemed to have been made) of such face value (limited to the amount paid by the recipient in respect of such face value) written off by him, the deduction so made being deemed for the purposes of the said section to be input tax.”; and by the substitution in subsection (3) for tbc words following upon paragraph (b) of the following words: “an amount equal to the tax fraction, as applicable at the time of such deduction, of that portion of the consideration which has not been paid shall be deemed to be tax charged in respect of a taxable supply made in the next following tax period after the expiry of the period of [36] 12 months: Provided that the period of [36] 12 months shall, if any contract in—writing in terms of which such supply was~ade provides for the payment of consideration or any portion thereof to take place after the expiry of the tax period within which such deduction was made, in respect of such consideration or portion be calculated as from the end of the month within which such consideration or portion was payable in terms of that contract.”. (c) Amendment of section 23 of Act 89 of 1991, as amended by section 20 of Act 20 of 1994

37. Section 23 of the principal Act is hereby amended by the substitution for subsection (2) of the following subsection: “(2) Every person who, in terms of subsection (1) or section 50A, becomes liable to be registered shall not later than21 days after becoming so liable apply to the Commissioner for registration in such app Iication form as the Commissioner may [approve] direct and provide the Commissioner with such further particulars and any documentation as the Commissioner may require in such application form for the purpose of registering that person: Provided that where— (i) a person who applies for registration under this subsection has not provided till particulars and cloclllllcllt:lti~)tl as required by Ilw Colnnlissi(mcr, timl pcrsoll 15 20 25 30 35 40 45 50 .$() No. 18113 Act ~0. 27, 1!)97 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 shall be deemed not to have applied for registration until he has provided all such particulars and documentation to the Commissioner; (ii) such person is not a resident of the Republic, such person shall be deemed not to have applied for registration until he has— (au) appointed a representative vendor as contemplated in section 48(1) in the Republic and furnished the Commissioner with the particulars of such rcprcscntalivc vendor; (bb) opened a banking irccoun( wilh any bank, mutual bank or otlwr similar institution for the purposes of his enterprise carried on in the Republic and furnished the Commissioner with the particulars of such banking account.”. Amendment of section 32 of Act 89 of 1991

38. Section 32 of the principal Act is hereby amended- (a) (b) by the addition of the word “or” at the end of paragraph (b) of subsection (l); and by the insertion after paragraph (b) of the said subsection(1) of the following paragraph: “~ any direction or supp lementary direction made by the Commissioner and served on that person in terms of section 50A(3) or (4),”. 5 10 15 Amendment of section 36 of Act 89 of 1991, as substituted by section 2 of Act 61 of 1993 and amended by section 18 of Act 140 of 1993 and section 22 of Act 20 of 1994 20

39. Section 36 of the principal Act is hereby amended by the substitution for subsection (l) of the following subsection: “(1 ) The obligation to pay and the right to receive and recover any tax, additional tax, penalty or interest chargeable LIndcr [his Act shall not, unless Il~c Commissiorwr’ so direcls, bc sus@ndcd by :llly appeal or pcmlir)g [Iic dccisioll of a court of law, but if any assessment is allerrxl or) appcid or in conformity will] ally such decision or a decision by the Commissioner to concede the appeal to the special board or the special court or such court of law, a due adjustment shall be made, amounts paid in excess being refunded with interest at the prescribed rate (but subject to the provisions of [section] sections 45(1) and 45A) and calculated from the date proved to the satisfaction of the Commissioner to be the date on which such excess was received and amounts short-paid being recoverable with penalty and interest calculated as provided in section 39(l).”. Amendment of section 39 of Act 89 of 1991, as amended by section 37 of Act 136 of 1991, section 16 of Government Notice 2695 of 8 November 1991, section 30 of Act 136 of 1992, section 3 of Act 61 of 1993 and section 23 of Act 20 of 1994

40. Section 39 of the principal Act is hereby amended- (a) by the deletion of subsection (4); and (b) by the substitution for subsection (7) of the following subsection: “(7) [Where] To the extent that the Commissioner is satisfied that the failure on the part of [any] the person concerned or any other person under the control or acting on behalf= that person to make payment of the tax within the period for payment contemplated in subsection (l)(a,), (2), (3), (6) or (6A) or & the date-referred to in subsection [(4) or] (5), as the case may be— ((7) did, having regard to the output tax and input tax relating to the supply in respect of which interest is payable, not result in any lillilnc’i;ll 10ss (including any loss (d’ inlcrcso 10 lhc Stale; or (ii) such pcrs{m did not bcncli[ Iirlancially (lakir~g inlcrcsl into accounl) (i) 25 30 35 40 45 by not making such payment within (11c said period or on the said 50 date, he may remit the interest payable in terms of this section; or 42 No. 18113 Act No. 27, 1997 GOVERNMENT GAZE’ITE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACr, 1997 @) was not due to an intent [to avoid] not to make payment or to postpone liability for the payment of the tax [or the Commissioner is partly so satisfied], he may remit [in whole or in part] any penalty [or interest] payuble in terms of this section.”. Amendment of section 41 of Act 89 of 1991, as amended by section 32 of Act 136 of 5 1992 and section 36 of Act 97 of 1993

41. Section 41 of Ihc principal Act is hereby wllended- (u) by [he deletion of itcm (A) of subparagraph (ii) of paragraph (d); and (b) by the substitution for subparagraph (au) of paragraph (d) of the following paragraph: “(au) that the tlailure to pay the amount which should have been paid was not due to an intent of the person concerned or any other person under the control or acting on behalf of that person not to [avoid the] make pdyment of tax; and”. 10 Amendment of section 44 of Act 89 of 1991, as amended by section 37 of Act 97 of 15 1993 and section 27 of Act 37 of 1996

42. Section 44 of the principal Act is hereby amended- (a) by the substitution for paragraph (u) of subsection (3) of the following paragraph: “(a) the claim for the refund of such excess amount of tax, additional tax, 20 penalty or interest is [made] received by the Commissioner within five yews after the date upon which payment of the amount claimed to be refundable was made: Provided that if the Commissioner is satisfied that such payment was made in accordance with the practice generally prevail ing at the said date, no refund shall bc mule unless k claim for 25 tiny refund is [made] rcccivcd bwc C(mlmissioncr within six m(mths after that date; or”; and (b) by the substitution for subsection (8) of the following subsection: “(8) If the Commissioner refuses to make or authorize a refund in terms of this section he shall [at the request of the vendor concerned], give [the vendor] 30 written notice of such refusal.”. Amendment of section 45 of Act 89 of 1991, as amended by section 33 of Act 136 of 1992, section 4 of Act 61 of 1993 and section 24 of Act 20 of 1994

43. Section 45 of the principal Act is hereby amended— (a) by the substitution for paragraph (i) of the proviso to subsection (1) of the 35 following paragraphs: “(i) [this subsection shall not apply where— (au)] where such return made by the vendor is incomplete or defective in any material respect [or] the said period of 21 business days shall be reckoned from the date on which— (au) the vendor rectifies the return and satisfies the Commissioner that the incompleteness or defectiveness of the return does not affect the amount refundable; or (bb) the Commissioner makes an assessment upon the vendor reflecting the amount properly refundable to the vendor, 40 45 whichever date is earlier; [(bb)](iA) where the vendor is in default in respect of any of his obligations under d~is Act to l’urnisll a return for al]y tax pcri(d prcccding tllc said tax pcri(xl as rcquird by [Ilis Ac{, IIIC said wriod 01”2 I busilwss da s shall be rcclwncd Iron) tllc dale on which tiny such outstanding return or returns furnished by the vendor as required by this Act are received by such a Receiver of Revenue;”; and ‘---~50 44 No. 18113 Act No. 27, 1997 GOVERNMENT GAZE7TE, 4 JULY [997 TAXATION LAWS AMENDMENT ACT, 1997 (b) by the addition to the proviso to the said subsection (1,) of the following paragraph: “(iii) where the vendor is not a resident of the Republic and— (au) has not appointed a representative vendor as contemplated in section 48( 1 ) in the Republic or has not furnished the Com&issioner with the particulars of such rcprcscntative vendor; or . . (bb) has not opened a banking acxxmnt in the Republic as required by paragraph (ii)(bb) of the proviso to section 23(2) or has not furnished (Iw Conunissioncr with tlw particulars of SUCI1 banking accolln[, the said period of 21 business days shall be reckoned from the date the vendor furnishes the Commissioner with the particulars of such representative vendor or banking account, as the case may be.”. 5 10 Insertion of section 50A in Act 89 of 1991

44. The following section is hereby inserted in the principal Act after section 50: 15 “Separate persons carrying on same enterprise under certain circum- stances deemed to be single person 50A. (1) Notwithstanding the provisions of section 23, if the Commis- sioner makes a direction under this section, the persons named in the direction shall be deemed to be a single person carrying on the activities of an enterprise described in the direction and that person shall be liable to be registered in terms of section 23 with effect from the date of the direction or, if the direction so provides, from such date as may be specified therein. (2) The Commissioner shall not make a direction under this section naming any person unless hc is salislicd- (11) (b) (c) (d) tl;at suc”h person is nmking or has Inadc [axable supplies; ald that the activities in the course ot’ which hc makes or mwlc those taxable supplies form only part O( certuin activities which should properly be regarded as those of the enterprise described in the direction, the other activities of that enterprise being carried on at that time or previously by one or more other persons; and that, if all the taxable supplies of that enterprise were taken into account, a person carrying on that enterprise should at that time be liable to be registered in terms of subsection (1); and that the main reason or one of the main reasons for the person concerned carrying on the activities first referred to in subparagraph (b) in the way he does is the avoidance of a liability to be so registered (whether that liabiIity would be his, another person’s or that of two or more persons jointly). 20 25 30 35 (3) A direction made under this section shall be served on each of the 40 persons named in it. (4) Where, after u direction has been given under this section specifying a description of the enterprise, it appears to the Commissioner that a person who was not named in that direction is making taxable supplies in the course or furtherance of activities which should properly be regarded as part of the activities of that enterprise, the Commissioner may make and serve on him a supplementary direction referring to the earlier direction and the description of the enterprise specified in it and adding that person’s name to those of the persons named in [hc earlier direction with elrect lroln- (d) the dale on which hc began to nlakc th~)sc taxable supplies; or 45 50 46 No, 18113 Act No. 27, 1997 (1)) GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 if it was later, the date with effect from which the single person referrec to in the earlier direction became liable to be registered in terms of thi: section. (5) If, immediately before a direction (including a supplernentar) direc(ion) is made under (his section, any person named in the direction if registered in respect of (he taxable supplies made by him as contcmplatec in subsection (2) or (4), he shall cease (U be liable to bc so registered witk e!rec t from- (u) the date with effect from which the singfe person concerned became liable to be registered; or (b) the date of the direction, whichever date is the later. (6) In relation to an enterprise specified in a direction (including a supplementary direction) under this section, the persons named in such direction, who together are deemed to be the liable person, are in subsections (7) and (8) refereed to as the members. (7) For the purposes of this Act, where a direction is made under this section— (a) (b) (c) (d) (e) the person carrying on the enterprise specified in the direction shall be registrable in such name as the members may jointly nominate upon compliance with the provisions of section 23(2); any supply of goods or services by or to one of the members in the course of the activities of such single person shall be deemed to be a supply by or to such single person; each of the members shall be jointly and severally liable for any tax due by such single person; notwithstanding the provisions of paragraph (c), any failure by such single person to comply with any rcquircmcnl imposc(.f upon him hy or under this Act shall bc dIXIIWd (() bc a failure by caclI ()( (I)c llwn~bcrs severally; and subject to paragraphs (a) to (d) of this subsection, the metnbers shall be deemed to be a body of persons carrying on the enterprise of such single person and any question as to the scope of the activities of that enterprise at any time shall be determined accordingly. (8) If the Commissioner is of the opinion that any person who is one of the members should no longer be regarded as such for the purposes of subsection (7)(c) and (d) and the Commissioner gives notice to that effect, that person shall no longer be liable in terms of that subsection for anything done after the date specified in that notice and shall be deemed to have ceased to be a member of the body of persons referred to in subsection (7J(eJ.”. 5 10 [5 !0 !5 () ‘5 o Amendment of section 52 of Act 89 of 1991, as substituted by section 39 of Act 136 of 1991

45. Section 52 of the principal Act is hereby amended by the substitution in subsection 45 (1) for the words preceding the first proviso of the following words: “Any pool managed by any board or body for the sale of agricultural, pastoral or other farming products, being a pool contemplated in [section 57 of the Marketing Act, 1968 (Act No. 59 of 1968)] section 17 of the Marketing of Agricultural Products Act, 1996 (Act No. 47 of 1996), may, on written application by such board or body, for the purposes of this Act be deemed to be an enterprise or part of an enterprise carricxl on by that board or body separately from dw members of such board or h(dy:”. 50 48 No. 18113 Act No. 27, 1997 GOVERNMENT GAZETTE. 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 Amendment of section 54 of Act 89 of 1991, as amended by section 40 of Act 136 of 1991, section 34 of Act 136 of 1992 and section 25 of Act 20 of 1994 46, Section 54 of the principal Act is hereby amended by the addition to subsection (2A) of the following pamgraph, the existing subsection becoming paragraph (a): “(b) Notwithstanding the provisions of paragraph (a), where any goods are 5 impor(ed into the Republic by an agent who is acting on behalf of anolhcr person who is the principal for the purposes of that impmla(ion, at)d- (i) (ii) the agent is a regis[ercd vendor; and the principal is not a resident of the Republic and is not a registered vendor; and the goods are imported by the principal for the purposes of a supply made or to be made by him to a person in the Republic; and the agent obtains and retains documentary proof, as is acceptable to the Commissioner, that— (aa) he paid the tax on importation on behalf of that principal; and (bb) such agent and that principal agree in writing that the stiid tax has not and will not be reimbursed to such agent by that principal, 10 15 (iii) (iv) that importation shall for the purposes of this Act be deemed to be made by such agent and not by that principal.”. Amendment of section 57 of Act 89 of 1991, as substituted by section 24 of Act 46 of 1996 20

47. Section 57 of the principal Act is hereby amended by the substitution in subsection (1) for the definition of “judge” of the following definition: “ ‘judge’ means a judge of the [Supreme Court] High Court and includes a judge in chambers.”. 25 Amendment of section 57C of Act 89 of 1991, iis inserted by section 24 of Act 46 of 1996

48. Section 57C of the principal Act is hereby amended by the substitution for subsection (3) of the following subsection: “(3) A judge may, on [ex par-te] application by the Commissioner or any officer contemplated in section 57(4), grant an order in terms of which a person contemplated in subsection (7) is designated to act as presiding officer at the inquiry contemplated in this section.”. 30 Amendment of section 57D of Act 89 of 1991, as inserted by section 24 of Act 46 of 1996 35

49. Section 57D of the principal Act is hereby amended by the substitution in subsection (1) for the words preceding paragraph (a) of the following words: “For the purposes of the administration of this Act, a judge may, on [ex partel application by the Commissioner or any oflicer contemplated in section 57(4), issue a warrant, authorizing the otilcer named therein to, without prior notice and at any time-”. Amendment of section 60 of Act 89 of 1991, as amended by section 42 of Act 136 of 1991

50. Section 60 of the principal Act is hereby amended by the substitution in subsection (I) for the words prcccding paragraph (a) of (hc following words: “Where any vcmlor or any Imrson under (I1c ctmtrol or acling (m bchall’ of (hc veodor tails to perform any duly impow.xl upul) Ilim by this Act or does or omits to do anything, with intent-”. 40 45 50 No, 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 Insertion of section 67B in Act 89 of 1991 51. (1) The following section is hereby inserted in the principal Act after section 67A: “Registration of motor vehicles prohibited in certain circumstances

67U. Any motor vchiclc rcg,istcring authority in the Republic shall not rcgislcr any imported rnolor vchiclc unless [hc person applying for rc~istration produces to such rc~istcrinx authoritv- (~~j in the c~isc of a motor vehi~e whic~l is irmpoitcd into (hc Republic and I is not required to be entered in terms of ttle Customs and Excise Act, a document, receipt or certificate showing that any tax which may be payable in terms of this Act has been paid in respect of such importation into the Republic; or in the case of a motor vehicle which is imported into the Republic and is required to be entered in terms of the said Customs and Excise Act, a customs document showing that any tax which may be payable under this Act has been paid in respect of such importation into the Republic; or an exemption certificate issued by the Commissioner to the e(fect that no tax is payable in terms of this Act in respect of the importation of the motor vehicle.”. (.!)) (c) 5 10 15 (2) Subsection (1) shall come into operation on a date fixed by the President by 20 proclamation in the Gazette. Amendment of section 75 of Act 89 of 1991, as amended by section 45 of Act 136 of 1991 and section 41 of Act 136 of 1992 and substituted by section 29 of Act 20 of 1994

52. Section 75 ot’ the principal Act is hereby an)cIIdcd- 25 (a) by the substitution ior subsections ( I ) alxl (2) of lhe I’ullowing subsections, respectively: “(1 ) The [President] National Executive may enter into an agreement with the government of any other country [or territory] whereby arrangements are made with that government with a view to— (a) the prevention, mitigation or discontinuance of the levying, under the laws of the Republic and such other country [or territory], of value-added tax or any similar tax where the supply of goods or services is subject to such tax in either the RepubIic or such other country [or territory] and such supply or the importation of such goods or services 35 is also subject to such tax in the other country [or territory] which is a party to the agreement; 30 (b) the refunding of value-added tax or any similar tax, or any portion of such value-added tax or similar tax, levied under the laws of the Republic and such other country [or territory] in respect of the supply of goods or 40 services in the Republic or such other country [or territory], as the case may be, where such goods or services are imported into such other country [or territory] or the Republic, as the case may be; (c) regulating or co-ordinating any matter with regard to the levying and collection, under the laws of the Republic and such other country [or 45 territory], of value-added tax or any similar tax; or (d) the rendering of reciprocal assistance in the administration of and the collection of value-added tax or any similar tax under the laws of the Rcimblic and SUCII olhcr c(mnlry Ior tcrrilory]. or in respect of lhc cxcculioll 01” lhc arr:lngctncllls pr~)vidcd for in any agrccllwn[ cntcrcd 50 into in terms 01 this scctioo 5? No. 18113 Act No. 27, 1997 GOVERNMENT GAZH”13, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 (2) As soon as may be possible after the [conclusion] approval by Parliament of any such agreement, as contemplated in section 231 of the Constitution, the arrangements thereby made shall be notified by [the President by notice] publication in the Gaze[/e [whereupon until such notice is withdrawn by the President] and thereupon the arrangements ~ notiticd [therein shall, in relation to value-added Pax in the Republic] shall have ellcct as if mulcted by this Act.”; by lhc deletion 01 subsection (3); by dIc deletion 01 subsection (4); and by the substitution for subsection (5) of’ the following subsection: “(5) The duty imposed by this Act to preserve secrecy with regmxl to such tax shall not prevent the disclosure to any authorized ofticer of the country [or territory mentioned in any notice issued in terms of subsection (2)] contemplated in subsection (1) of any information necessary for the proper execution of the agreement notified in [such notice] terms of subsection (2).”. (l)) ((:) (d) Amendment of Schedule 1 to Act 89 of 1991, as amended by section 48 of Act 136 of 1991, section 24 of Government Notice 2695 of 8 November 1991, section 43 of Act 136 of 1992, Government Notice 2244 of 31 July 1992, section 44 of Act 97 of 1993, Government Notice 1955 of 7 October 1993, section 32 of Act 20 of 1994 and section 32 of Act 37 of 1994

53. PART A of Schedule 1 to the principal Act is hereby amended by the substitution for subparagraph (a) of paragraph 5 of the following subparagraph: “(a) a public authority or a local authority; or”. 5 10 15 20 Special exemption in respect of goods or services supplied by International Telecommunication Union 25 5 4 . T h e supi?iy of any g(Nds (w scrviccs hy tile in(crllali(mal “~clcc{IilIllltl ilic:lli(~tl Union in connection wi[i~ “Alrica Tciccom 9X” shall bc cxclnpt l’rotll vaiuc-addd tax imposed in terms of section 7(1)(a) ot’ (he Vaiuc-Added Tax Act, 199 i (Act No. 89 of 1991). Amendment of section 60 of Act 113 of 1993, as amended by section 20 of Act 140 of 1993, section 4 of Act 168 of 1993, section 34 of Act 20 of 1994, section 6 of Act 37 of 1995 and section 34 of Act 37 of 1996 30 55. (1) Section 60 of the Income Tax Act, 1993, is hereby amended by the substitution in subsection (1) for paragraphs (a), (b) and (c) of the definition of “distributable shares” of the following paragraphs: “(a) any shares in one or more listed companies held [on 19 June 1995 or such other date as may be determined from time to time by the Minister of Finance by notice in the Gazette] by an unbundling company (hereinafter referred to as the holder) on the date of the approval of the proposed transaction in terms of subsection (2) for its own benefit, whether directly or indirectly through one or more intermediate companies, if— (i) that holder’s interest, on such date [and at the time of the approval of the proposed transaction in terms of subsection (2)] in at least one of such listed companies constitutes at least 10 per cent of the equity share capital of such listed company; or (ii) suciI shares so held on such date [and time] represent at least 70 per cent of the market value of the assets of such hoider; and (/)) [an? furlhcr shams (if any) in listed companies acquired by such holder for 1(s own hcnclit after that (Iiltc in addition 10 the sbat-cs referred to in paragraph (u), if— 35 40 45 50 54 No, 1s113 Act No. 27, 1997 GOVERNMENT GAZETTE. 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 (i) such further shares so acquired and the shares referred to in paragraph (a) are to be distributed in specie in the course of an unbundling transaction and the Commissioner is satisfied that such distribution will be effected in the course of or in anticipation of the winding-up or liquidation of such holder, subject to such conditions 5 as the Commissioner may deem necessary; and (ii) such further shares so acquired are registered in lhc nanw of such holder and stamp duty is duly paid on the registration of transfer of such shares in the name of such holder; aml (c)] any shams in an unliskxl company held on [19 June 1995 or such other date 10 as may be determined from time to time by the Minister of Finance by notice in the Gazetfe] such date by an unbundling compuny for its own benefit i f— (i) such unbundling company’s interest in such unlisted company on [the] such date [and time referred to in paragraph (a)] constitutes at least 30 15 per cent of the equity share capital of such unlisted company; or (ii) such shores so held on [the] ~ date [and time referred to in paragraph (a)] represent at least 70 per cent of the market vulue of the assets of such unbundling company,”. (2) Subsection (1) shall be deemed to have come into operation on 1 May J 997. 20 Amendment of section 39 of Act 20 of 1994, as amended by section 7 of Act 3’7 of 1995 and section 35 of Act 37 of 1996 56. (1) Section 39 of the Taxation Laws Amendment Act, 1994, is hereby anlended- (a) by the substitution in subsection (1) for the definition of “controlled company” of the following definition: “ ‘controlled company’ means a compmy in relation to which another company is at the date [and time] referred to in the definition of ‘controlling ,,, Lwlnpany” the conlrt)lllng cfmlpany; , 25 (b) by [he subs[itulion in subsection ( 1 ) (or paragrapl)s ({/) and (/..) uI’ IIW dcfioitiun of “controlling company” of the following words: “[(a)] on [19 June 1995 or such other date as may be determined from time to time by the Minister of Finance by notice in the Gazette or, where such other company is incorporated after such date, or after such other date, and the Commissioner is satisfied that such other company was incorporated to give effect to a rationalisation 35 scheme, the date of incorporation of such other company; and 30 (b) at] the [time] date of any agreement referred to in the definition of ‘rationalisation scheme’ to which such other company is a party,”; (c) by the substitution in subsection (1) for the definition of “group of companies” of the following definition: “ ‘group of companies’ means a controlling company and one or more other companies which are controlled in relation to the controlling company at the date [and time] referred to in the definition of ‘controlling company’ ;“; (d) by the substitution in subsection (1) for the words preceding paragraph (a) of the definition of “rationalisation scheme” of the following words: “ ‘rationalisation scheme’ means any scheme effected in terms of an agreement in writing [concluded on or after 19 June 1995 or such other date as may be determined from time to time by the Minister of Finance by notice in the Gazette] for the rationalisation of the activities of a group of companies where—”; and (e) by the substitution for the words preceding paragraph (u) of subsection (6) of 40 45 50 (Iw following” words: “F(n IIw p u r p o s e s 01 taxalion Icvicd under the Inwnw ‘1’ax ACI a nd llotwi(llst;il~diilg anything to the conmu’y contained in that Act, where on lor after 19 June 1995 or such other date as may be determined from time to 55 time by the Minister of Finance by notice in the Gazette] the date of the 56 No, 18113 Act No. 27, 1997 GOVERNMENT GAZETTE. 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 agreement referred to in the definition of ‘rationalisation scheme’, the whole or a part of any business undertaking is disposed of (whether by way of sale, donation, cession, dividend or in any other form) in terms of a rationalisation scheme by a company (hereinafter referred to as the transferor company) to any other company (hereinafter referred to as the transferee company) and 5 both such companies are at the time of such disposal members of one imd the same group of companies, the controlling company involved in such schcmc and the Commissioner may agree that-”. (2) Subsection ( I ) shall bc deemed to have come into operation on 1 May 1997. Amendment of section 1 of Act 38 of 1996 57, (l) Section 1 of the Tax on Retirement Funds Act, 1996, is hereby amended- (u) by the dele[ion of the word “and” at the end of paragraph (a) of the definition of “interest”; (b) by the addition of the word “and” at the end of paragmph (b) of the definition of “interest”; (c) by the addition to the definition of “interest” of the following paragraph: “(c) any amount contemplated in section 24K of the Income Tax Act;”; and (d) by the insertion after the definition of “pensioner” of the following definition: “ ‘rental income’ includes- (a) any royalty; (b) any premium or like consideration contemplated in paragraph (g) of the definition of ‘gross income’ in section 1 of the Income Tax Act; (c) any dividend (other than those distributed out of profits of a capital nature) distributed by a fixed property company as defined in section 1 of the Unit Trusts Control Act, 198 I (Act No. 54 of 1981); and (d) any consideration payable by a borrower to the lender in respect of any ‘lending arrangement’ as dcfinml in section 23(1) of the Stamp Duties Ac(, 196X (Act N(). 77 of 1968), as consideration lor IIW usc of any nmrfomblc iccurity, in so far as SUCI1 allwunt is nol ilwludcd ill pwagrapil I (d) of the definition of ‘interest’;”. (2) (u) Subsection (1)(c) shall come into operation on the date of promulgation of this Act and shall apply in respect of agreements entered into on or after that date. (b) Subsection (l)(d) shall be deemed to have come into operation on 1 March 1997. 10 15 20 25 30 Amendment of section 3 of Act 38 of 1996 58. (1) Section 3 of the Tax on Retirement Funds Act, 1996, is hereby amended by the 35 substitution for paragriiphs (b) and (c) of the following paragraphs, respectively: (c) “(b) ‘I’ represents the gross amount of any interest received by or accrued to such fund during such tax period from a source within the Republic or deemed to be within the Republic as contemplated in [section] sections 9 and 9C of the Income Tax Act; ‘R’ represents the gross amount of any rental income [(including any royalty and any premium or like consideration contemplated in paragraph (g) of the definition of ‘gross income’ in section 1 of the Income Tax Act)] received by or accrued to such fund during such tax period from a source within the Republic or deemed to be within the Republic as contemplated in 45 the last-mentioned [section] sections 9 and 9C; and”. — — 40 — — (2) Subsection (1) shall in so far as it relates to— (a) the deletion of the inclusion in rental income, be deemed to have come into operation on 1 March 1997; (1~) [hc insertion of a rcf’crcncc to scclion 9C [)f tllc income. Tilx Act, 1962, bc 50 dccmcd to have come into (jpcrati(m on I .luly I 997. 58 No. 18113 Act No. 27, 1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAW’S AMENDMENT ACT, 1997 Amendment of section 16 of Act 38 of 1996

59. Section 16 of the Tax on Retirement Funds Act, 1996, is hereby amended- (a) by the deletion of the word “and” at the cnd of paragraph (h); (b) by the addition of [he following paragraphs: “~ rebate in respect of foreign taxes on income; and @ income of contmllcd foreign cn(ilics and investment income arisinx from 5 any d(mati(m, scttlcmcnl or olhcr disposition,”; ((:) by lhc delclion of the w(mi “and” tit tllc cnd of paragraph (v); and (d) by the addition of the 101 lowing paragraphs: “~ the granting of any rebate of any foreign taxes cm income as a deduction 1() from any tax payable by a fund; ml ~ in respect of the inclusion of an y investment income in the income of any fund “—. . Continuation of certain amendments of Schedules Nos. 1 to 6 to Act 91 of 1964 60. (1) Every amendment of Schedules Nos. 1 to 6 to the Customs and Excise Act, 1964, made under section 48, section 56 or section 75(15) of that Act on or before 31 December 1996 shall not lapse by virtue of the provisions of section 48(6), 56(3) or 75(16) of that Act. (2) The amendments of Schedule No. 5 and Schedule No. 6 to the Customs and Excise Act, 1964, made under section 75( 15) of that Act by Government Notices No. R.433 and No. R.432, respectively, of 13 March 1997, shall not lapse by virtue of the provisions of section 75 (16) of that Act. (3) The amendment of Part 2B of Schedule No. I to the Customs and Excise Act, 1964, made under section 48 of that Act by Government Notice No. R.434 of 13 March 1997, shall not lapse by virtue of the provisions of section 48(6) of that Act. 15 20 25 Short tillc

61. This Ac[ shall be called lhc Taxtition Laws Amcndl]lcnt Act, 1997. 60 No. 18113 Act No. 27.1997 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 SCHEDULE (Section 15) AMENDMENTS TO SCHEDULE NO. 1 TO THE CUSTOMS AND EXCISE ACT, 1964 TARIFF 1’11;}1 ‘rA 1{1 FF IIEADING I 04.00 ‘ 104,00 DIIXJR1 I’rrl ON RATE OF DUTY’ EXCISE CUSTOMS By (I]c substilu( ion fur hi-ill’ itcm 104.()() of (be following: PREPARED FOODSTUFF’S; BEVER- AGES, SPIRITS AND VINEGAR; TOBACCO 04.01 19.01 MALT EXrRACT FOOD PREPARA- TIONS OF FLOUR. MEAL, STARCH OR MALT EXTRACT, NOT CONTAINING COCOA POWDER OR CONTAINING COCOA POWDER IN A PROPORTION, BY MASS, OF LESS TIIAN 50 PER CENT, NOT ELSEWHERE SPECIFIED OR INCLUDED; FOOD PREPARATIONS OF GOODS OF HEADINGS NOS. 04.0 I TO 04.04. NOT CONTAINING COCOA POWDER OR CONTAINING COCOA POWDER IN A PR(M’ORTION, BY MASS, 01: [.1:SS ‘I’il AN 10 I’lil{ CliN”l’, NOT ELSMV}l ERE SPECII’I13U OR INCLUDED: Preparations bad on sorghum tlour, put up for making bevemges ‘22.01 WATERS, INCLUDING NATURAL OR ARTIFICIAL MINERAL WATERS AND AERATED WATERS, NOT CONTAIN- ING ADDED SUGAR OR OTHER SWEETENING MATTER NOR FLAVOURED; ICE AND SNOW 22,02 WATERS, INCLUDING MINERAL WA- TERS AND AERATED WATERS, CON- TAINING ADDED SUGAR OR OTHER SWEETENING MATTER OR FLAVOURED, AND OTHER NON-AL- COHOLIC BEVERAGES (EXCLUDING FRUIT OR VEGETA13LE JUICES OF HEADING NO. 20.09): Mined walers, including spa waters and ocra(cd wutcrs, put up in CIOWI bo[[lcs or o(hcr CIWWI coniaincrs ready for dt-inking w,i(ll{>lll dilull{)ll (cxuludlllg Iwvcldgcs p: IchLIl ill lllasllc (OIICS tw sil]lil:lr cLmloin - crs aod which arc norllallly c[)llsullwd it) a IIozcn SMIC) .10 04.05 .10 33clkg 33clkg 14,113cle 15,98cI( 62 No. 18113 Act No. 27, 1997 rARIFF TARIFF ITEM HEADING GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 DESCRIPTION RATE OF DUTY EXCISE CUSTOMS 14,83 c/e 15,98CM 14,83CIC i5,98c/e .20 .30 Lemonade and Ilavourcd mineral wtimrs, including tlavourcd spa imd acmted waters, put up in closed botllcs or olhcr clmcd containers rcmfy Ior drinking wilbtw( dilu- tion (cxclucling bcvcragcs packccl in plmtic tubes or similw containers tmd which wc normally consumed in u lro~cn slate) Nomalccrho]ic bevemgcs not elsewhere spccilicd or inclcrchxi in d]is krritf itcm, put U P III closed bo(tles or otbcr CIOSCd Co,,. [ainers ready for drinking without dilu(icm (excluding beverages packed in plos(ic tubes or similar cont~iners ond which me normally consumed in a frozen state) 34.10 22,03 BEER MADE FROM MALT WITH AN .10 .20 .30 .40 .50 .60 .70 .80 ALCOHOL CONTENT BY VOLUME: Exceeding 0,5% but not exceeding 1,5% Exceeding 1,5~o but not exceeding 2,5% Exceeding 2,5% but not exceeding 3,5% Exceeding 3,59. but not exceeding 4,5% Exceeding 4,57. but not exceeding 5,5% Exceeding 5,5% but not exceeding 6,5% Exceeding 6,5% but not exceeding 7,5’%o Exccding 7,5% 7 249cI 100C 7 903c/looe 8 557c/100t’ 9 211c/looe 9 865c/100e lo519c/looe 11 173c/loof 11 827c/l(K)( 7 249cflooe 7 9t)3c/loof 8 557c/loOe 9211c/100t 9 865cI1OW lo519c/looe I I 173c/iooe I I X27c/I()()f’ )4.15 22.04 WINE 01: IRESII GRAP1{S. lNCLUl)- ING fwfmfwm WINES; GRAPE Mus-r, OTHER THAN THAT OF HEADING NO. 20.09 22.05 VERMOUTHS AND OTHER WINE OF FRESH GRAPES FLAVOURED WITH PLANTS OR AROMATIC SUBSTANCES 22.06 OTHER FERMENTED BEVERAGES (FOR EXAMPLE, CIDER, PERRY AND MEAD): Sorghum beer (excluding beer made from preparations based on sorghum flour) Unfortified still wine Fortified still wine Other still fermented beverages, unfortified Other still fermented beverages, fortified Sparkling wine Other fermented beverages (excluding sorghum beer) .05 .10 .40 .50 .60 .70 ,80 745cI I ooe -145cllooe 5 315c/]ooe I I 5ooc/]ooe 7 35OCI1OW 13 353c/[ooe 14 750c/loot 15 906c/looe 5 315c/looe 11 5ooc/looe 7 350c/iooe I 3 353c/looe 14 750c/looe 15 906c/looe 64 NO. 18113 Act No. 27.1997 rARIFF TARIFF ITEiY1 1f3ADlNG 04,20 22.07 GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 DESCRIPTION RATE OF DUTY EXCISE CUSTOMS UNDENATURED ETHYL ALCOHOL OF AN ALCOHOLIC STRENGTH BY VOL- UME OF 80 PER CENT VOLUME OR HIGllE.R; ETHYLALCOHOLAND OTHER SPIRITS, DENATURED, OF ANY STRENGTII UNDENATUKED ETHYL ALCOHOL OF ~~,08 AN ALCOHOLIC STRt3NGTII BY VOL- UME OF LESS THAN W PER CENT VOLUME; SPIRITS, LIQUEURS AND OTHER SPIRITUOUS BEVERAGES; COMPOUND ALCOHOLIC PREPARA- TIONS OF A KIND USED FOR THE MANUFACTURE OF BEVERAGES: Wine spil-i(s, manufactured in the Republic by the distillation of wine Spirits, manufacurred in the Republic by the distillation ut’ any sugar cane product Spirits, manufoc[ured in the Republic by the cfislillation of wry grain product fllwr spirits. IIlallut’actlltcd in (I]c Rcpuhlic Imported spir’i[s of’ any nzturc, including spirits in imported spirituous bcvcragcs (excluding liqueurs, cordials and similar spirituous beverages containing added sugw) and in compound alcoholic prcpm- tions of an alcoholic strength exceeding 1,713 pcr cent alcohol by volume Spirits of any nature in imported liqueurs, cordials and similar spirituous beverages containing added sugar. with m’ without flavoul-ing substances CIGARS, CHEROOTS. CIGARILLOS AND CIGARETTES, OF TOBACCO OR OF TOBACCO SUBSTITUTES OTHER MANUFACTURED TOBACCO AND MANUFACTURED TOBACCO SUBSTITUTES, “HOMOGENISED” OR “RECONSTITUTED” TOBACCO EX- TRACTS AND ESSENCES: Cigars Cigarettes I’lus. ill ICSI)CC[ (JI cigarc(tcs IIw I]):lss {JI tbc tnbacco con[cnt uf which CXCCCLS I.5 kg/1 ()()0 ci.gwcttcs Cigmcttc tobacco .10 .15 .25 ,~[) .60 .70 04.30 24.02 24.03 .10 .2(: .3( 237 687cI 100t of absolute alcohol 249 633cl100t of absolute alcohol 255 037c/ 100f of absolute alcohol 243 ()() Xc/ I 00( 01” ahsolu(c idcobol” — — — 228 074CIIOOC of absotutc alcohol or 98 072c/100? — 228 074c/ 100t of absolute alcohol 672,5c/kg net ?9c/ I O cigarettes

2 W4c/!ig 706,0c/kg net 79c/1 () cigarettes 2 944clkg [obaccu COI1[CI1l tobacco c[mtcnt 99c150g or fraction thereof’ 99c/50g or fmction thereof plUS 382c/kg tobacco p[US 382c/kg tnbacco 66 No. 18113 Act No. 27, 1997 TARIFF TARIFF ITEM HEADING GOVERNMENT GAZETTE, 4 JULY 1997 TAXATION LAWS AMENDMENT ACT, 1997 DESCRIPTION RATE OF DUTY Plus a wspcnded duly of (i) In opcmlion (11) Maxilnum raw Pipe tobacco ill Immcdia[c pockings 0( a content of’ Icss tbwr 5 kg PIpc [otxwco in immcdii]lc packings of a content of 001 less tbmr 5 kg .40 .5(J I EXCISE CUSTOMS Nil 13 I c/kg krbwxo 727c/kg nrx Nil 13 I c/kg k)b:l~C() 727clkg IIC[ 699c/kg llCt 699c/kg ncl”