Carbon pricing could assist in the dual pursuit of mitigating global climate change and contributing to government coffers. The way in which a government allocates carbon tax revenues is a key factor in the public's acceptance of carbon pricing policy and ultimately in its enduring success. To that end, this article presents an innovative, simple classification framework of carbon tax revenue usage which has four modalities to cater for various policy design features. These are: a constrained approach as opposed to an unconstrained one; a revenue-neutral recycling approach as opposed to a revenue-raising one; an approach according to public preference; and a thematic approach. Thereafter, various attributes are examined to assist policymakers in selecting an appropriate modality. The classification framework will be useful for policymakers as a quick point of reference before embarking on more complex and in-depth policy deliberations. Key policy insights:. Carbon pricing is the most cost-effective regulatory approach for reducing greenhouse gas emissions and is recognized as a significant contributor to government revenue. . Carbon tax revenue use can be classified into four overarching modalities to cater for various policy design attributes. . There is no dominating revenue use option from an economic or political viewpoint, owing to trade-offs across various fiscal policy objectives. . Carbon taxes are elements of broader tax reform and therefore revenue use options should be aligned with a jurisdiction's broader fiscal policy charter.
The reportable arrangements (RA) provisions are contained in sections 80M to 80T of the Income Tax Act. SARS issued a revised Draft Guide on 31 March 2010, which contains a model for the application of these provisions. However, due to numerous discrepancies and ambiguities contained in the Act and the guide, the interpretation of these provisions could be subjective and difficult to apply in practice. Failure to disclose a RA may result in a R1 million penalty. It is the purpose of this paper to develop an alternative, workable model to serve as a usable guide for taxpayers. This paper comprises a literature review and a study of empirical evidence obtained through a survey conducted among tax partners at a sample of 40 leading audit and legal firms. The majority of respondents considered the alternative model to be more accurate, user-friendly and helpful than SARS’ model.
In the years since the Organisation for Economic Cooperation and Development (OECD) adopted its first draft tax treaty in 1963, the world has experienced an astonishing surge in international trade and investment. The tax treatment of these cross-border transactions is affected by double tax agreements. As tax treaty networks will likely continue to expand, concerns about tax treaty abuse might be expected to grow. The extent to which a countrys tax treaty policy favours developing countries - or not - depends upon the extent to which the country is prepared to adopt provisions from the UN model tax convention as opposed to the OECD model. Developing countries, in particular, should carefully consider the design of their tax treaties so as to effectively combat tax avoidance without sacrificing foreign direct investment. To this end, the Canada/South Africa tax treaty is compared and contrasted with these two models. The concept of beneficial ownership is reviewed in this context. It is contended that a general definition in South Africa's Income Tax Act of 'beneficial ownership' would assist in the interpretation of the term for the purposes of South Africa's tax treaties. It is submitted that the scope for the source taxation of passive investment income (viz. dividends, interest and royalties) in the developing country could be magnified through treaty negotiations.
Orientation: The study investigated the association between ownership concentration and different payout methods of selected companies listed on the Johannesburg Stock Exchange (JSE) in South Africa for the financial reporting periods 2012 to 2019.Research purpose: The research objective was to investigate whether payout behaviour differed when low and high ownership concentration was compared.Motivation for the study: An understanding of the association between ownership concentration and payout policies is an important corporate governance aspect that could reveal the agency conflict between majority and minority shareholders. No previous South African empirical study has considered testing or investigating the two opposing agency-based hypotheses, namely the monitoring and rent extraction hypotheses, with reference to different payout methods.Research design, approach, and method: An empirical research design was followed, which is descriptive in nature. Descriptive statistics and a mixed-model analysis of variance were employed to describe the different payout methods – that is ordinary dividends, special dividends, capital distributions, additional shares, general share repurchases, and specific share repurchases – employed by companies listed on the JSE based on a distinction between low and high ownership concentration.Main findings: High ownership concentration was found to be associated with statistically significant lower ordinary dividends and capital distributions in support of the rent extraction hypothesis. Rent extraction highlights the agency conflict between majority and minority shareholders.Practical/managerial implications: Findings of the present study revealed agency conflicts that may be informative to those charged with corporate governance to help them resolve agency conflict.Contribution/value-add: This study is the first to consider the association between ownership concentration and payout behaviour in South Africa subsequent to the introduction of the dividends tax regime in 2012. The descriptive evidence submitted can serve as a basis for further explanatory research relating to ownership concentration and payout behaviour of companies.
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