The Taxation Of South Africa

CHAPTER 21 PARTNERSHIPS SOLUTIONS TO PROBLEM MATERIALS | | | | |Status: | Q/P | |Question/ |Learning | | |Present |in Prior | |Problem |Objective |Topic | |Edition |Edition | | | | | | | | | | | | 1 LO 1 Partnership definition New 2 LO 2 General partnership versus LLC New 3

Please describe the concept of “double taxation” and discuss which entity(ies) are subject to this type of taxation. (5 pts)

Host countries laws specifically on taxes and repatriation of profits might affect due to political reforms in their country. (Fox, 2015)

North and South both employed different approaches for taxation and in the long run the North's tax system proved to be more effective. The southern society enjoyed one of the lightest tax burdens and the government’s all efforts to generate revenue-using taxation proved to be ineffective in the long run.

Income tax is considered to be one of the greatest ways that a country amasses wealth through known means from the public in order to use the funds for the benefit and welfare of the community. Since a very long time, there have been many discussions and debates on the way the finds collected for income tax have been spend. There are many who think that there is a lot of mismanagement and feel that the amount of the actual money spent on welfare of the community is far less that what gets collected by the country.

The definition of tax compliance in its most simple form is usually cast in terms of the degree to which taxpayers comply with the tax law. However like many such concepts, the meaning of compliance can be seen almost as a continuum of definitions. This ranges from the narrow law enforcement approach, through wider economic definitions and on to even more comprehensive versions relating to taxpayer decisions to conform to the wider objectives of society as reflected in tax policy (Alley, 2010).The purpose of taxation and tax compliance is, taxation does not exist in some sort of economic, social and political vacuum.

Taxation systems are usually modeled in such a way that they take into consideration the social welfare of the citizens. The government and other policy makers have the responsibility of ensuring that the system takes into account the needs of the citizens. The bottom line is that taxation should foster equal distribution of resources. The rate of taxation is usually arrived at after several considerations have been made. The rates are not fixed as they depend on the various economic changes. The issue of how taxation should be distributed among the different economic classes is yet to be addressed.

The income tax system in our country is cumbersome, complex, and not user friendly. There are many problems associated with our system and most of the country wants a reform to the tax system. Some simply want only changes to the existing system while others want a completely new design. There are a few different alternatives available to us all which have their upside and downside. The Subtraction Method Value Added tax is one system which will be discussed here as a result of its many benefits.

South Africa, a nation that is located at the tip of the African Continent. The economy of South Africa is based almost completely on mining and the production of minerals. With a rich history of colonization and independence, along with a fight for freedom. Widely diverse with many ethnicities and languages, the people come from many different places into one.

CHAPTER 9 TAXATION OF INTERNATIONAL TRANSACTIONS SOLUTIONS TO PROBLEM MATERIALS | | | | |Status: | Q/P | |Question/ |Learning | | |Present |in Prior | |Problem |Objective |Topic | |Edition |Edition | | | | | | | | | | | 1 LO 1 Worldwide income Unchanged 1 2 LO 1 Worldwide

Capital gain is made on the capital assets which are sold for value more than the cost base of it as per Section 104 (10). It means that for making capital gain a capital gain tax event has to happen. Few capital assets are not taxable even when it makes a capital gain on incurring a capital gain tax event. One of them is a resident property which is used completely for living in it by the taxpayer.

Just as an egg will vary from hen to hen, so do tax systems from country to country. Each country has its own rules and principles to levy taxes from its citizens and foreigners to whom it conducts business in order to support its operations. South Africa is no different. When a country’s own people conduct business, or foreigners invest or trade within its domestic jurisdiction, it is necessary for the tax system to balance carefully its domestic and international economic objectives. It is essential to understand how the taxation system is applied to residents and non-residents in order to maximize one’s own benefits through adequate tax planning. In South Africa, the law determines the tax system through which the Commissioner must oversee/enforce. Among all the tax acts, the Customs Act 91 of 1964, The Income tax Act 58 of 1962, and the VAT Act 89 of 1991 are the most important ones. South Africa employs a residence-based system. This means that, except for certain exclusions; residents are being taxed on their worldwide income regardless of where their income was earned. In other words, a resident of a particular country will be subject to the taxes of that country. Where as in the United States, all citizens, even if they are not a resident, may be subject to their worldwide income. South Africa has not always employed a residence-based system. Before 2011, a source-based system was being used. Income is taxed in the country where that income originates,

The effects of sin taxable products on the South Africa’s economy and their impact on South Africa’s Socio Economic Issues

In terms of section 1 paragraph (a) of the Income Tax Act, for an individual to be physically present in South Africa during a year of assessment, the person must be present in

Such a taxation system should be reasonable and non-discriminatory in respect to both the direct taxes payable by the people and the indirect taxes payable by corporations and industries so as to make them more tax-compliant.