SAPICS 2019 Post-Conference Ezine - Page 31

“Once the carbon tax has been
calculated, it will be paid to (and
administered by) National Treasury,
which will determine any further tax
allowances, based on trade exposure,
business performance, etc. At this
point the process could become quite
abstruse and bogged down by litigative
complexities, and you’ll need some
expert assistance,” he cautioned SAPICS
adopt low carbon alternatives. Additional
tax-free allowances include an additional
allowance of up to 10% for process
emissions; an additional allowance for
trade exposed sectors, to a maximum
of 10%; and an additional allowance
of up to 5% based on performance
against emissions intensity benchmarks.
These benchmarks will be developed
in due course. There is also a carbon
offsets allowance of 5 to 10% per cent,
depending on sector, and an additional
5% tax-free allowance for companies
participating in phase 1 of the carbon
budgeting system. As part of the tax,
the carbon offset mechanism also allows
companies to participate in a marketbased approach to reduce emissions.
“We would recommend getting experts
to help you navigate the tricky terrain of
tax law.” He stated that there were things
businesses could do now to anticipate
this burden and reduce their waste to
landfill so that less of the business is
exposed to heavy carbon taxability,
including investing in renewable energy,
cool carbon projects and biogas
digesters, and reducing waste to landfill.
Ensuring Right Reporting
“Carbon emissions are submitted to the
Department of Environmental Affairs
(DEA) through legislation known as the
National Greenhouse Gas Emission
Reporting Regulation (NGER). Here,
companies that rely on energy generation
from their own equipment are obligated to
report on all business-related activities for
tax purposes.
“Africa is uniquely poised to leapfrog
fossil fuel, carbon heavy systems and
adopt wind, solar and water energy on
sustainable, large-scale levels,” Lourens
“The tax will take all your activities into
account, including the activities related to


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