South Africa’s double taxation plans for expats branded ‘totally unjust”
The proposed move is expected to affect hundreds of thousands of South African’s working abroad.
South Africa’s proposal to double tax citizens who work abroad has been branded as “achingly regressive” by the head of one of the world’s largest independent financial services firms.
The plans put forward by the South African Revenue Services in the shape of the Draft Rates and Monetary Amounts and Amendment of Revenues Laws Bill would result in hundreds of thousands of expats who already have their income taxed abroad, being taxed domestically too. At the moment, if they work outside of South African shores for more than 183 days per year, they are not obliged to pay tax on their overseas income.
Nigel Green, founder and chief executive of deVere Group, said: “The move is totally unjust and breaks the cornerstone principal of taxation: that the taxpayer receives government services for their taxes such as healthcare, education, roads and police services.”
He slammed the proposals as being “highly discriminatory” as he believed it was unfair to tax someone simply because of their citizenship. “This draconian move to double tax South African expats effectively shackles them to South Africa and they would no longer enjoy the same freedoms as almost everyone else in the world,” Green pointed out.
Only the US and Eritrea currently operate similar “misguided” citizen-based taxation regimes, he continued, but there was now a growing campaign in the US to shift to a residence-based taxation model in line with the rest of the world.
The Bill is open to public consultation until 18 August.