Chair, Deputy President, hon Ministers and Deputy Ministers, hon members and comrades, the political necessity for any state to advance its programmes and ensure the relevancy of these programmes to its political future depends in the main on an established and well- functioning taxation system that directs both tax liability provisions and the tax administration provisions.
The economic base of the state is not just about an ideological discussion of what the macroeconomic fiscal and monetary policy principle should be. It is true that it is necessary to have ideological clarity on macroeconomic principles, but the task of driving the state is dependent on a taxation regime that will realise those ideological convictions.
If the state does not address this, it follows all the dangers of becoming detached from its base: its human resources, the people unable to financially address their demands and unable to put into practice policy decisions that would result, as in the case of the ANC, in a better quality of life.
A tax regime is led, firstly, by a clear policy. In our country the ANC and its government have been able to put together a combination of taxation policies which reflect the ethos of the organisation and its policy directives. The ANC taxation policy speaks to the progressive nature of the South African taxation regime in which the poor are shielded whilst the wealthy contribute accordingly. Secondly, the ANC taxation policy speaks to the redistributive nature of the South African taxation system - something which this House has witnessed during many budget speeches of the Minister of Finance, which has assisted, in the main, the poor and those in low-income categories.
Thirdly, the ANC tax policy speaks to an effective administrative tax system that adds value to the fiscus and the economy, through its provisions assisting in the building of the domestic economy and the national output.
Fourthly, the ANC tax policy speaks to the ongoing need for tax reform as part of the overall transformation of tax legislation and the financial sector.
These four pillars are the driving force behind any legislative change to a taxation regime. Today we deal specifically with deepening taxation reform in our country that is necessary so as to ensure that we have a fiscus that can assist in bringing into reality our vision of a national democratic society characterised by a thriving and integrated economy with the ability to create employment opportunities and an economy in which increasing social equality and economic growth form a virtuous cycle of development, which, progressively, is intended to improve the quality of life of all citizens; an economy that deals decisively with poverty and frees the potential of each and every individual. The Tax Administration Bill incorporates into one piece of legislation generic administrative provisions which are currently duplicated in different tax Acts. It seeks to achieve a balance between powers and duties of tax collection and the rights and obligations of taxpayers. It is a preliminary step in the rewriting of the Income Tax Act and assists by dividing the work into more manageable parts.
The principles that we have adopted in approaching the draft, as is the case in a range of ANC financial policies, are drawn from international best practices. Here the principles of equity and fairness; certainty and simplicity; and efficiency and effectiveness apply.
What the ANC intends the Tax Administration Bill to achieve is a simplified and harmonised piece of legislation in that taxpayers will only have one tax administration Act to deal with, in which all the duties and rights with regard to tax law are set out in a simplified format. In addressing the administrative burden on tax collection, the Bill reduces the unnecessary and duplicated provisions, and inefficiency and ineffective provisions are also removed, as stated by the Minister.
What the ANC is doing with this Bill is to ensure a more modern, responsive revenue administration which will provide a better service to those who are tax compliant, as a system that can reward and serve them better; while at the same time we are bringing in stricter enforcement, assessment and collection powers to deal with increasingly sophisticated tax evaders.
In line with the Constitution, rights of taxpayers and obligations of tax collection are balanced. Greater equity and fairness are also introduced through this Bill, which again is a constitutional obligation.
We held comprehensive public hearings on the Bill in Parliament, as alluded to by the Minister. The following issues were raised, inter alia, by some at these hearings: the introduction of a Tax Ombud as a mechanism to address service failures and failures in respect of taxpayers' rights. This will provide an effective recourse for taxpayers to balance powers and rights. The Tax Ombud has been introduced to deal with two kinds of disputes that arise: disputes in the interpretation of law, and disputes in the administration of law. The powers of the Tax Ombud are powers of review and powers to mediate. It reports directly to the Minister of Finance.
It is our conclusion as the ANC that this Bill will ensure a broadening of the tax base in support of inclusive growth, raise revenue to finance government programmes and projects, provide tax relief for deserving individuals of course, and provide tax breaks to support employment creation and skills development, which we dearly need to enhance infrastructure investment. This Bill will also assist in providing for changes in personal income tax brackets and rebates and changes in certain monetary thresholds. It is our take as the ANC that this particular change will definitely clear and boost our intention for lower-income groups to have more disposable income at their disposal.
This Bill will assist to support inclusive growth in the following fashion: it will provide further personal income tax relief; the Bill will introduce a third rebate for aged individuals 75 years and over; it will give clarity on transfer duty relief; the Bill will obviously deal with various monetary threshold adjustments, including increases in the capital gains exclusion amounts; it will also provide for measures to enhance the learnership and industrial policy incentive programmes; this Bill will further provide for an increase in the turnover tax exemption threshold for micro businesses; and new antiavoidance measures will also be taken care of in this Bill.
In conclusion, the Bill seeks to considerably streamline and enhance tax administration. It will create greater certainty in tax administration and reduce the number of disputes, we believe, between Sars and the taxpayer. It certainly enhances the rights of taxpayers while, at the same time, enhancing tax morality, which is crucial for the credibility of our tax system. With those few words, I stand here to confirm that as the ANC, we support the Tax Administration Bill. Thank you. [Applause.]