________

(MINISTER OF FINANCE)

_______

[ ] Words in bold type in square brackets indicate omissions from existing enactments.

_____________ Words underlined with a solid line indicate insertions in existing enactments.

(1) Section 3 of the Marketable Securities Tax Act, 1948, is hereby amended by the deletion of subparagraph (vii) of paragraph (c) of subsection (3).

(2) Subsection (1) shall come into operation on 1 January 2000.

Section 9C of the Marketable Securities Tax Act, 1948, is hereby amended -

1. by the substitution for paragraph (b) of subsection (8) of the following paragraph:

"(b) have the same powers -

9. to enforce the attendance of witnesses and to compel them to give evidence or to produce evidential material; and

2. relating to contempt,

as are vested in a President of the Special Court contemplated in section 83 of the Income Tax Act, 1962; and";

(b) by the substitution for subsections (11), (12) and (13) of the following subsections:

"(11) Any person whose affairs are investigated in the course of an inquiry contemplated in this section, shall be entitled to be present [throughout] at the inquiry during such time as his affairs are investigated, unless on application by the person contemplated in subsection (1), the presiding officer directs otherwise on the ground that the presence of the person and his representative, or either of them, would be prejudicial to the effective conduct of the inquiry.

(12) Any person contemplated in subsection (9) has the right to [a representative of his choice] have a legal representative present during the time that he appears before the presiding officer.

(13) An inquiry contemplated in this section shall [not be public] be private and confidential and the presiding officer shall at any time on application [of] by the person whose affairs are investigated or any other person giving evidence or the person contemplated in subsection (1), exclude from such inquiry or require to withdraw therefrom, all or any persons whose attendance is not necessary for the inquiry.";

3. by the addition after subsection (14) of the following subsections:

"(15) Any person who has been required to appear before the presiding officer at the inquiry and who—

(b) having been sworn or having made an affirmation—

shall be guilty of an offence.

(17)(a) No person may refuse to answer any question on the grounds that it may incriminate him or her.

(b) No such incriminating evidence shall be admissible in any criminal proceedings against the person giving such evidence, other than in proceedings where that person stands trial on a charge relating to the administering or the giving of false evidence or the making of a false statement in connection with such questions and answers, or a failure to answer lawful questions fully and satisfactorily, or a charge in connection with a breach of the provisions of subsection (15).

(18) An inquiry in terms of this section shall proceed notwithstanding the fact that any civil or criminal proceedings are pending or contemplated against or involving any person identified in subsection (6)(c) or any witness or potential witness or any person whose affairs may be investigated in the course of that inquiry.".

. (1) Section 9 of the Transfer Duty Act, 1949, is hereby amended―

1. by the deletion of paragraph (bA) of subsection (1);
2. by the substitution for the words preceding the proviso to paragraph (c) of subsection (1) of the following words:

"a public benefit organisation [religious, charitable or educational institution of a public character] which is exempt from tax in terms of section [10(1)(f)] 10(1)(cN) of the Income Tax Act, 1962 (Act No. 58 of 1962), in respect of property acquired [for religious, charitable or educational purposes] exclusively for purposes of the public benefit activity carried on by such public benefit organisation:";

3. by the deletion of paragraph (j) of subsection (1);
4. by the insertion after subsection (1) of the following subsection:

"(1A) No duty shall be payable in respect of the registration of any property transferred by-

1. any public benefit organisation which is exempt from tax in terms of the provisions of section 10(1)(cN) of the Income Tax Act, 1962, to any other entity in order to comply with the provisions of the proviso subsection (2) of section 30 of that Act; or
2. any fund contemplated in section 10(1)(fA) of the Income Tax Act, 1962, to any other entity in order to comply with the provisions of paragraph (b) of the first proviso to section 10(1)(fA);";

1. by the deletion of subsection (13); and
2. by the deletion of subsection (14).

(2)(a) Subsection (1)(a) shall come into operation on 1 January 2000.

(b) Subsection (1)(b), (c) and (d) shall come into operation on a date determined by the President by way of proclamation in the Gazette.

(c) Subsection (1)(e) shall come into operation on the date of promulgation of this Act.

Section 11D of the Transfer Duty Act, 1949, is hereby amended―

1. by the substitution for paragraph (b) of subsection (8) of the following paragraph:

"(b) have the same powers-

9. to enforce the attendance of witnesses and to compel them to give evidence or to produce evidential material; and

2. relating to contempt,

as are vested in a President of the Special Court contemplated in section 83 of the Income Tax Act, 1962; and";

(b) by the substitution for subsections (11), (12) and (13) of the following subsections:

"(11) Any person whose affairs are investigated in the course of an inquiry contemplated in this section, shall be entitled to be present [throughout] at the inquiry during such time as his affairs are investigated, unless on application by the person contemplated in subsection (1), the presiding officer directs otherwise on the ground that the presence of the person and his representative, or either of them, would be prejudicial to the effective conduct of the inquiry.

(12) Any person contemplated in subsection (9) has the right to [a representative of his choice] have a legal representative present during the time that he appears before the presiding officer.

(13) An inquiry contemplated in this section shall [not be public] be private and confidential and the presiding officer shall at any time on application [of] by the person whose affairs are investigated or any other person giving evidence or the person contemplated in subsection (1), exclude from such inquiry or require to withdraw therefrom, all or any persons whose attendance is not necessary for the inquiry."; and

(c) by the addition after subsection (14) of the following subsections:

"(15) Any person who has been required to appear before the presiding officer at the inquiry and who—

(b) having been sworn or having made an affirmation—

shall be guilty of an offence.

(17)(a) No person may refuse to answer any question on the grounds that it may incriminate him or her.

(b) No such incriminating evidence shall be admissible in any criminal proceedings against the person giving such evidence, other than in proceedings where that person stands trial on a charge relating to the administering or the giving of false evidence or the making of a false statement in connection with such questions and answers, or a failure to answer lawful questions fully and satisfactorily, or a charge in connection with a breach of the provisions of subsection (15).

(18) An inquiry in terms of this section shall proceed notwithstanding the fact that any civil or criminal proceedings are pending or contemplated against or involving any person identified in subsection (6)(c) or any witness or potential witness or any person whose affairs may be investigated in the course of that inquiry.".

Section 15 of the Transfer Duty Act, 1949, is hereby amended by the substitution for subsection (3) of the following subsection:

"(3) Any person who fails to comply with any provision of this section shall be guilty of an offence and liable on conviction to a fine [not exceeding fifty rand] or to imprisonment for a period not exceeding three months."

Section 1 of the Estate Duty Act, 1955, is hereby amended by the insertion after the definition of "company" of the following definition:

"'domestic policy' means any life policy as defined in section 1 of the Long-term Insurance Act, 1998 (Act No. 52 of 1998), issued anywhere upon an application made or presented to a representative of an insurer (or to any person on behalf of such a representative) at any place in the Republic, not being a life policy which has been made payable at a place outside the Republic at the request of the owner, but includes any life policy issued outside the Republic which has subsequently been made payable in the Republic at the request of the owner;".

Section 3 of the Estate Duty Act, 1955, is hereby amended by the substitution for paragraph (a) of subsection (3) of the following paragraph:

"(a) so much of any amount due and recoverable under any policy of insurance which is a domestic policy [as defined in section 1 of the Insurance Act, 1943 (Act 27 of 1943)], upon the life of the deceased as exceeds the aggregate amount of any premiums or consideration proved to the satisfaction of the Commissioner to have been paid by any person who is entitled to the amount due under the policy, together with interest at six per cent per annum calculated upon such premiums or consideration from the date of payment to the date of death: Provided that the foregoing provisions of this paragraph shall not apply in respect of any amount due and recoverable under a policy of insurance, if any".

. (1) Section 4 of the Estate Duty Act, 1955, is hereby amended-

1. by the substitution for subparagraph (i) of paragraph (h) of the following subparagraph:

"(i) any [charitable, educational or religious institution of a public character] public benefit organisation which is exempt from tax in terms of section 10(1)[(f)](cN) of the Income Tax Act, 1962 (Act 58 of 1962), and any fund which has been approved by the Commissioner under the provisions of section 10(1)(fA) of that Act which provides funds solely to any such public benefit organisation; or"; and

2. by the deletion of subparagraphs (ii) and (iv) of paragraph (h).

(2) Subsection (1) shall come into operation on a date to be determined by the President by proclamation in the Gazette and shall apply in respect of any person who dies on or after that date.

. Section 8D of the Estate Duty Act, 1955, is hereby amended-

1. by the substitution for paragraph (b) of subsection (8) of the following paragraph:

"(b) have the same powers-

9. to enforce the attendance of witnesses and to compel them to give evidence or to produce evidential material; and

2. relating to contempt,

as are vested in a President of the Special Court contemplated in section 83 of the Income Tax Act, 1962; and";

(b) by the substitution for subsections (11), (12) and (13) of the following subsections:

"(11) The executor of the estate of the deceased person whose affairs are investigated in the course of an inquiry contemplated in this section, shall be entitled to be present [throughout] at the inquiry during such time as his affairs are investigated, unless on application by the person contemplated in subsection (1), the presiding officer directs otherwise on the ground that the presence of the executor and his representative, or either of them, would be prejudicial to the effective conduct of the inquiry.

(12) Any person contemplated in subsection (9) has the right to [a representative of his choice] have a legal representative present during the time that he appears before the presiding officer.

(13) An inquiry contemplated in this section shall [not be public] be private and confidential and the presiding officer shall at any time on application [of] by the executor or any other person giving evidence or the person contemplated in subsection (1), exclude from such inquiry or require to withdraw therefrom, all or any persons whose attendance is not necessary for the inquiry."; and

(c) by the addition after subsection (14) of the following subsections:

"(15) Any person who has been required to appear before the presiding officer at the inquiry and who—

(b) having been sworn or having made an affirmation—

shall be guilty of an offence.

(17)(a) No person may refuse to answer any question on the grounds that it may incriminate him or her.

(b) No such incriminating evidence shall be admissible in any criminal proceedings against the person giving such evidence, other than in proceedings where that person stands trial on a charge relating to the administering or the giving of false evidence or the making of a false statement in connection with such questions and answers, or a failure to answer lawful questions fully and satisfactorily, or a charge in connection with a breach of the provisions of subsection (15).

(18) An inquiry in terms of this section shall proceed notwithstanding the fact that any civil or criminal proceedings are pending or contemplated against or involving any person identified in subsection (6)(c) or any witness or potential witness or any person whose affairs may be investigated in the course of that inquiry.".

. Section 23 of the Estate Duty Act, 1955, is hereby substituted by the following section:

"Every person who carries on in the Republic any insurance business shall whenever he, on the death of any person, makes payment of any claim under any policy of insurance which is a domestic policy [as defined in section one of the Insurance Act, 1943 (Act 27 of 1943)], upon the life of that person, advise the Commissioner, in such form as the Commissioner may require, of such payment."

Section 28 of the Estate Duty Act, 1955, is hereby amended by the substitution for the words following paragraph (b) of subsection (1) of the following words:

"shall be guilty of an offence and liable on conviction to a fine [not exceeding one thousand rand] or to imprisonment for a period not exceeding two years or to both such fine and such imprisonment.".

The rates of normal tax to be levied in terms of section 5(2) of the Income Tax Act, 1962, in respect of¾

1. the taxable income of any person other than a company for the year of assessment ending on 28 February 2001 or 30 June 2001; and
2. the taxable income of any company for any year of assessment ending during the period of 12 months ending on 31 March 2001,

shall be as set out in Schedule 1 to this Act.

(1) Section 1 of the Income Tax Act, 1962, is hereby amended—

1. by the substitution for paragraph (b) of the definition of "company" of the following paragraph:

"(b) any association, corporation or company incorporated under the law of any country other than the Republic or any body corporate formed or established under such law [if such association, corporation, company or body, as the case may be, carries on business or has an office or place of business in the Republic or derives income from any source within or deemed to be within the Republic or in which any person ordinarily resident or carrying on business in the Republic is interested as a shareholder or a member]; or";

2. by the deletion of paragraph (c) of the definition of "company";
3. by the substitution for paragraph (d) of the definition of "company" of the following paragraph:

"(d) any association (not being an association referred to in paragraph (a) or (f) [or an association to which the provisions of section 10 (1) (e) apply]) formed in the Republic to serve a specified purpose, beneficial to the public or a section of the public; or";

4. by the substitution of paragraph (e) of the definition of "company" of the following paragraph:

"(e) any

9. unit portfolio comprised in any unit trust scheme in securities other than property shares managed or carried on by any company registered as a management company under section 4 of the Unit Trusts Control Act, 1981 (Act 54 of 1981), if

[(i)](aa) such portfolio was created on or after the date of commencement of the Unit Trusts Control Amendment Act, 1962 (Act 11 of 1962);

[(ii)](bb) such portfolio was created before that date and the relevant trust deed has after that date been amended in order to create further units in that portfolio; or

2. arrangement or scheme carried on outside the Republic in pursuance of which members of the public are or will be invited or permitted to invest in a portfolio of a collective investment scheme, where two or more investors contribute to and hold a participatory interest in a portfolio of the scheme through shares, units or any other form of participatory interest;";

1. by the substitution of the words preceding paragraph (a) of the definition of "dividend" of the following words:

"’dividend’, means any amount distributed by a company (not being [a mutual building society or] an institution to which section 10(1)(d) applies) to its shareholders or any amount distributed out of the assets pertaining to any unit portfolio referred to in paragraph (e) of the definition of 'company' in this section to shareholders in relation to such unit portfolio (including, in the case of any co-operative society or company referred to in section 27, any amount distributed on or after 1 April 1977 to its members, whether divided among the members in accordance with their rights as shareholders or according to the value of business transactions between individual members and such society or company or on some other basis), and in this definition the expression 'amount distributed' includes"; and

2. by the insertion after paragraph (c) of the definition of "gross income" of the following paragraph:

as compensation for any restraint of trade imposed on such person;";

(g) by the insertion after paragraph (eA) of the definition of "gross income" of the following paragraph:

"(eB) any amount received by or accrued to any person by way of any distribution by any pension fund or provident fund to such person (other than any amount recoverable in terms of the provisions of section 37D of the Pension Funds Act, 1956 (Act No. 24 of 1956)), who during such year or any previous year of assessment as an employer contributed any sum to such fund for the benefit of its employees or former employees;";

8. by the substitution for paragraph (k) of the definition of "gross income" of the following paragraph:

"(k) any amount received or accrued by way of dividends including any [dividends distributed by a private company out of or by way of capitalization of any profits of such company, which in terms of section 37 of the Income Tax Act, 1941 (Act 31 of 1941), had previously been apportioned among its shareholders as the taxable income or the income subject to super tax of such company, and for the purposes of this paragraph all dividends from sources outside the Republic received by or accrued to any person (other than a company) who is ordinarily resident in the Republic or received by or accrued to any company, shall be deemed to have been received by or to have accrued to such person or company from a source within the Republic] amount determined in accordance with the provisions of section 9E in respect of any foreign dividend received by or accrued to any person who is a resident of the Republic as defined in such section;"; and

9. by the substitution for the definition of "prescribed rate" of the following definition:

"’prescribed rate’, in relation to any interest payable in terms of this Act, means such rate as the Minister of Finance may from time to time fix by notice in the Gazette for purposes of —

1. [in the case of] interest payable to any taxpayer under the provisions of section 89quat(4) [a rate of 12 per cent per annum]; or

(b) [in] any other [case a rate of 15 per cent per annum] provision of this Act

[or, in either case, such other rate as the Minister of Finance may from time to time fix by notice in the Gazette];"; and

8. by the substitution for the definition of "trading stock" of the following definition:

"'trading stock' includes—

1. anything produced, manufactured, purchased or in any other manner acquired by a taxpayer—

(i) for purposes of manufacture, sale or exchange by him or on his behalf; or

(ii) the proceeds from the disposal of which forms or will form part of his gross income; or

2. any consumable stores and spare parts acquired by him to be used or consumed in the course of his trade,

but does not include a foreign currency option contract and a forward exchange contract as defined in section 24I (1).

(2)(a) Subsection (1)(a), (b) and (d) will be deemed to have come into operation on 23 February 2000.

(b) Subsection (1)(c) shall come into operation on a date to be determined by the President by way of proclamation in the Gazette.

(c) Subsection (1)(f) shall be deemed to have come into operation on 23 February 2000, and shall apply in respect of any amount received or accrued on or after that date.

(d) Subsection (1)(g) shall be deemed to have come into operation on 23 Febraury 2000, and shall apply in respect of any amount received or accrued on or after that date.

(e) Subsection (1)(h) shall be deemed to have come into operation on 23 February 2000, and shall apply in respect of any foreign dividend—

9. received by or accrued to any resident on or after that date; or

2. which accrued to the resident before 23 February 2000, but which is received on or after that date: Provided that the provisions of this paragraph shall not apply in respect of any dividend declared by a company before 23 February 2000, where—

27. such company is listed on a recognised stock exchange; or
28. in any other case, the chief executive officer and—

1. an external auditor of the company; or
2. where a company is situated in a country which does not require compulsory appointment of an external auditor, a registered public accountant of the same standing as a qualified chartered accountant,

has declared under oath or made a solemn declaration that such dividend was actually declared by the company before 23 February 2000.

. Section 4 of the income Tax Act, 1962, is hereby amended—

1. by the substitution for paragraph (c) of the proviso to subsection (1) of the following paragraph:

"(c) the provisions of this subsection not be construed as preventing the Commissioner —

1. from disclosing to the Chief of the Central Statistical Services such information in relation to any person as may be required by such Chief in connection with the collection of statistics in complying with the provisions of the Statistics Act, 1976 (Act No. 66 of 1976), or any regulation thereunder; or.
2. publishing a list of public benefit organisations for purposes of the provisions of section 10(1)(fA), section 18A and section 30.";

1. by the substitution of subsection (3) of the following subsection:

"(3) Any person who contravenes the provisions of subsection (1) or (2A) shall be guilty of an offence and liable on conviction to a fine [not exceeding R5 000] or to imprisonment for a period not exceeding two years or to both such fine and such imprisonment.".

. Section 6 of the Income Tax Act, 1962, is hereby amended¾

1. by the substitution for the expression "R3 710" in paragraph (a) of subsection (2) of the expression "R3 800"; and
2. by the substitution for the expression R2 775" in paragraph (b) of subsection (2) of the expression "R2 900".

. (1) Section 6quat of the Income Tax Act, 1962, is hereby amended by the substitution for subsection (1) of the following subsections:

"(1) Subject to the provisions of subsection (2), there shall be deducted from the normal tax payable by any resident of the Republic or any person contemplated in section 9C(2)(b) or any shareholder who is a "resident" as defined in section 9E, in whose taxable income there is included —

1. any income received by or accrued to such resident or person from any country other than the Republic; or
2. any proportional amount of investment income contemplated in section 9D; or
3. any income payable to such resident from the Republic, where such income is deemed to be from a source within the Republic in terms of the provisions of paragraphs (d), (d)bis and (f) of section 9(1), or

(d) any foreign dividend contemplated in section 9E,

a rebate determined in accordance with this section.

(1A) For the purposes of subsection (1), the rebate shall be an amount equal to the sum of any taxes on income proved to be payable, without any right of recovery by any person (other than a right of recovery in terms of any entitlement to carry back losses arising during any year of assessment to any year of assessment prior to such year of assessment), by —

[(i)](a) [(aa)] (i) such resident of the Republic; and

[(bb)] (ii) any controlled foreign entity, as contemplated in section 9D, in respect of such proportional amount; or

[(ii)](b) such person contemplated in section 9C(2)(b); or

(d) any company in respect of the proportional amount of any profits from which any dividend is declared or deemed to have been declared to a controlled foreign entity and which dividend is included in the income of such shareholder as contemplated in subsection (1)(b),

to the government of such other country in respect of the amount of income so included in that resident's or person's or shareholder’s taxable income. (1B) [Provided that] Notwithstanding the provisions of subsection (1A), -

1. the rebate [under this subsection] shall not exceed an amount which bears to the total normal tax payable the same ratio as the taxable income attributable to the income so included bears to the total taxable income; and
2. where such sum of any taxes payable to the government of any such other country exceeds the rebate as determined in paragraph (a) [of this proviso] (hereinafter referred to as the excess amount), such excess amount [(excluding so much of such excess amount relating to foreign tax paid or payable by any controlled foreign entity which distributes its profits in the form of dividends] may-

9. in the case of any excess amount relating to any amount included in the income of any company in terms of paragraphs (a), (c) or (d) of subsection (1), be deducted from any Secondary Tax on Companies which becomes payable by such company after the determination of such excess amount, limited to an amount determined by applying the rate of the Secondary Tax on Companies to the profits attributable to the inclusion of the income contemplated in [paragraph (a) of this subsection] such paragraphs, or

(ii) in the case of any excess amount relating to any amount included in the income of any company in terms of paragraph (b) of subsection (1), be deducted from any Secondary Tax on Companies which becomes payable by such company on the distribution of any profits derived by way of dividends declared to such company by such controlled foreign entity from profits that were so included in terms of paragraph (b), limited to an amount determined by applying the rate of the Secondary Tax on Companies to the amount of the taxable income attributable to the inclusion of the income contemplated in such paragraph, after the deduction of -

[(i)](aa) any normal tax paid or payable; or

[(ii)](bb) such sum of taxes payable to the government of any such other country,

whichever amount is the greater;

1. where any shareholder, whether directly or indirectly, effectively holds for his own benefit less than 10 per cent of the equity share capital in any company in which the profits from which the dividend is distributed is derived, no rebate shall, notwithstanding the provisions of subsection (1A)(c)(ii), be allowed in respect of the tax imposed on such company; and

(d) no rebate shall be allowed in respect of any tax payable on any amount contemplated in subsection (1)(d), if the shareholder has made an election as contemplated in section 9E(6).".

(2) Subsection (1) shall be deemed to have come into operation on 23 February 2000, and apply in respect of any foreign dividend -

1. received by or accrued to any resident on or after that date; or
2. which accrued to the resident before 23 February 2000, but which is received on or after that date: Provided that the provisions of this paragraph shall not apply in respect of any dividend declared by a company before 23 February 2000, where -

9. such company is listed on a recognised stock exchange; or

(ii) in any other case, the chief executive officer and -

27. an external auditor of the company; or
28. where a company is situated in a country which does not require compulsory appointment of an external auditor, a registered public accountant of the same standing as a qualified chartered accountant,

has declared under oath or made a solemn declaration that such dividend was actually declared by the company before 23 February 2000.

. (1) Section 8 of the Income Tax Act, 1962, is hereby amended —

1. by the substitution for paragraph (g) of subsection (1) of the following paragraph:

"(g) Where, during any year of assessment, any person contemplated in paragraph (e) has held a public office for less than 12 months, the amount of R2 500 referred to in the proviso to paragraph (d)(iv) and the amount determined [by the Minister] in terms of paragraph (f), shall be reduced to an amount which bears to the relevant amount, the same ratio as the number of months (in the determination of which a part of a month shall be reckoned as a full month), for which the office was held bears to 12 months.";

(b) by the addition to paragraph (a) of subsection (4) of the following proviso:

"Provided that the provisions of this paragraph shall not apply in respect of any such amount so recovered or recouped which has been included in the income of such taxpayer in terms of paragraph (eB) of the definition of ‘gross income’."; and

1. by the substitution for paragraph (e) of subsection (4) of the following paragraph:

"(e) If any amount which was deducted¾

1. under the provisions of section 11(e) or section 12(1) or section 12(1) as applied by section 12(3) or the corresponding provisions of any previous Income Tax Act or section 12B or section 12C or section 14 or section 14bis or section 27(2)(d), in respect of machinery or plant which was used by the taxpayer directly in a process of manufacture, or directly in any other process carried on by him on or after 15 March 1961, which in the opinion of the Commissioner was of a similar nature; or
2. in respect of machinery or plant which was used by an agricultural co-operative (as defined in section 27(9)) directly for storing or packing pastoral, agricultural or other farm products or for subjecting such products to a primary process as defined in the said section 27(9); or
3. in respect of a ship or aircraft used by him for purposes of his trade; or
4. in respect of any pipeline, transmission line or cable or railway line as contemplated in section 12D,

has as a result of damage or destruction (hereinafter referred to as 'the event') been recovered or recouped during any year of assessment, and if the taxpayer satisfies the Commissioner¾

[(i)](aa) that he has concluded or will within a period of one year (or such longer period as the Commissioner in the circumstances of the case may allow) from the date of the event conclude a contract for the acquisition by him of further new or unused machinery or plant, [or a] ship, [or] aircraft, pipeline, transmission line or cable or railway line (hereinafter referred to as the 'further asset') to replace the aforesaid machinery, [or] plant, [or] ship, [or] aircraft, pipeline, transmission line or cable or railway line; and

[(ii)](bb) that the further asset has been or will be brought into use within a period of three years from the date of the event and will be used by him¾

[(aa)](A) directly in a process of manufacture or any other process which in the opinion of the Commissioner is of a similar nature;

[(bb)](B) in the case of such co-operative, directly for storing or packing pastoral, agricultural or other farm products or for subjecting such products to a primary process, as defined in section 27 (9); or

[(cc)](C) in the case of a ship or aircraft, directly for the purposes of the taxpayer's trade,

for a period of not less than five years or until the further asset is scrapped or disposed of in the ordinary course of the taxpayer's trade prior to the expiry of such period of five years,

the said amount shall, notwithstanding the provisions of paragraph (a) of this subsection, not be included in the income of the taxpayer for the aforesaid year of assessment: Provided that if, owing to any occurrence or because of any circumstance arising during any year of assessment the Commissioner is no longer satisfied in regard to the matters in regard to which in terms of the preceding provisions of this paragraph he is required to be satisfied, the said amount shall be included in the income of the taxpayer for the year of assessment during which such occurrence takes place or such circumstance arises.".

(2)(a) Subsection (1)(a) shall be deemed to have come into operation on 1 March 1999.

(b) Subsection (1)(b) shall be deemed to have come into operation on 23 February 2000.

(c) Subsection (1)(c) shall be deemed to have come into operation on 23 February 2000.

. (1) Section 9C of the Income Tax Act, 1962, is hereby amended by the substitution for the definition of "resident" in subsection (1) of the following definition:

"‘resident’ means―

1. any natural person who is ordinarily resident in the Republic; and
2. any person other than a natural person which is incorporated or has its place of effective management in the Republic;".

(2) Subsection (1) shall be deemed to have come into operation on 23 February 2000.

. (1) Section 9D of the Income Tax Act, 1962, is hereby amended―

1. by the substitution for the definition of "investment income" in subsection (1) of the following definition:

"'investment income' means investment income as defined in section 9C(1) and includes any foreign dividend as defined in section 9E;";

2. by the substitution for the proviso to subsection (2) of the following proviso:

"Provided that―

1. the provisions of this subsection shall not apply to any amount of investment income to which the provisions of subsection (4) are applicable; and

(b) the amount of any investment income received by or accrued to such entity by way of foreign dividends, shall for the purposes of this section be determined in accordance with the provisions of section 9E, as if such entity had been a resident.";

1. by the substitution of the words preceding the proviso to paragraph (a) of subsection (9) of the following words:

"in respect of investment income, other than income from foreign dividends, where the foreign tax actually paid or payable without any right of recovery by any person (other than a right of recovery in terms of any entitlement to carry back losses arising during any year of assessment to any year of assessment prior to such year of assessment) in any country other than the Republic, relating to the proportional amount contemplated in subsection (2) or (4), after taking into consideration any deductions or allowances under the taxation provisions of such other country determined at the ratio as contemplated in subsection (2) or (4), as the case may be, is more than 85 per cent of the normal tax payable in the Republic:"; and

2. by the substitution for paragraph (d) of subsection (9) of the following paragraph:

"(d) to any particular class of investment income which is taxable in a country which the Minister of Finance has identified by notice in the Gazette as a country whose tax on income is determined on a basis which is substantially the same as that of the Republic; or"; and

3. by the addition to subsection (9) of the following paragraph:

"(f) in relation to the proportional amount of any foreign dividend declared to or deemed to has been declared to a controlled foreign entity which is attributable to any resident, to the extent that the profits from which the dividend is declared or deemed to be declared has been included in the income of such resident in terms of the provisions of this section.

(2) Subsection (1) shall be deemed to have come into operation on 23 February 2000, and apply in respect of any foreign dividend -

1. received by or accrued to any resident on or after that date; or
2. which accrued to the resident before 23 February 2000, but which is received on or after that date: Provided that the provisions of this paragraph shall not apply in respect of any dividend declared by a company before 23 February 2000, where -

(i) such company is listed on a recognised stock exchange; or

(ii) in any other case, the chief executive officer and -

27. the external auditor of the company; or
28. where a company is situated in a country which does not require compulsory appointment of an external auditor, a registered public accountant of the same standing as a qualified chartered accountant,

has declared under oath or made a solemn declaration that such dividend was actually declared by the company before 23 February 2000.

. (1) The following section is hereby inserted in the Income Tax Act, 1962, after section 9D:

"Taxation of foreign dividends.

"designated country" means a country which the Minister of Finance has identified by notice in the Gazette, as contemplated in subsection (8);

"effective date" means 23 February 2000;

"fixed capital" includes share capital, share premium and accumulated profits, whether of a capital nature or not;

"foreign dividend" means any dividend received by or which accrued to any person from any company, to the extent that the dividend is declared from profits derived by such company from a source outside the Republic and which is not deemed to be from a source within the Republic, and includes the following amounts, which shall be deemed to be a dividend declared by such company to such person, -

1. any amount deemed to have been distributed by any company as contemplated in section 64C(3)(a), (b), (c) or (d) to such person or any resident who is a connected person in relation to such person to the extent that such company could have distributed a dividend to such person from profits derived from a source outside the Republic and not deemed to be from a source in the Republic and none of the provisions contained in section 64C(4) apply: Provided that the provisions of this paragraph shall not apply in respect of any amount distributed by any company which is being wound up or liquidated, out of profits of a capital nature (other than profits of a capital nature derived from the disposal by such company on or after 23 February 2000 of any interest in any other company with retained profits which were available for distribution by such other company to such company which would not have been excluded from the provisions of paragraph (b) had that provision applied); or
2. any amount derived by any person from the disposal by such person of any share or interest in the fixed capital in a company, to the extent that such company or any subsidiary of such company has any undistributed profits which were derived from a source outside the Republic and not deemed to be from a source in the Republic, which were available for distribution to such person: Provided that the provisions of this paragraph shall not apply in respect of the disposal of any share or other interest in the fixed capital in a company -s

(i) where such person at all times on and after 23 February 2000 held less than 10 per cent of the total equity share capital of such company;

(ii) to any resident or to any entity which is a controlled foreign entity for purposes of section 9D;

2. where such person retains the same effective interest in the equity share capital or fixed capital in the non-resident company as prior to the disposal: Provided that the provisions of this subparagraph shall not apply if the main or one of the main purposes of such disposal is the avoidance, postponement or reduction of liability for the payment of any tax;
3. by a shareholder who acquired such shares or interest from any person who is not a resident and who is not a connected person in relation to such shareholder, to the extent that such undistributed profits were derived prior to the acquisition of the shares by such shareholder;
4. to the extent that the proceeds from the disposal have otherwise been taken into account in the determination of the taxable income of such person; or
5. where the Commissioner is satisfied that the disposal of the shares was not effected for purposes of avoiding the liability for tax, taking into account such conditions as the Minister may prescribe by way of regulation;

"proportionate amount of the profit" in relation to a shareholder means an amount which bears to the total profit, the same ratio as such shareholder’s shareholding bears to the total shareholding, and for this purpose, if there are different classes of shares —

1. the expression "total shareholding shall refer only to the total of the class of shares to which such shareholding belongs; and
2. the expression "total profits" shall mean the total profit attributable to such class of shares;

"resident" means a resident as defined in section 9C(1).

(2) Any foreign dividend received by or accrued to a resident shall for the purposes of the definition of "gross income" in section 1, be deemed to have been received by or to have accrued to such resident from a source within the Republic.

(3) Subject to subsection (7), where during any year of assessment any foreign dividend is received by or accrues to any resident, the amount to be included in the gross income of such resident for such year of assessment in terms of paragraph (k) of the definition of "gross income" in section 1 of this Act, shall be —

1. if such resident holds for his own benefit at least 10 per cent of the equity share capital in the company declaring the dividend, the proportionate amount of the profit from which the dividend is distributed, before taking into account any foreign tax on income imposed in respect of such profit and any withholding tax paid in respect of such dividend: Provided that —

1. the dividend will be deemed to have been distributed from the profits most recently derived and available for distribution; and
2. where such company derived its profits by way of dividends received or accrued and by way of profits other than dividends, the dividend shall be deemed to have been declared on a proportionate basis from such profits; or

1. if such resident holds for his own benefit less than 10 per cent of the equity share capital in the company declaring the dividend, the amount of such dividend declared before taking into account the amount of any withholding tax paid in respect of such dividend.

(4) In determining the proportionate amount of the profit to be included in the income of any resident in terms of subsection (3)(a), there shall be taken into account any profits derived by any other company in which the company distributing the dividend has a direct or indirect interest and which have been distributed to such company in the form of dividends, if the resident has an direct or indirect interest in the equity share capital of such other company of at least 10 per cent: Provided that—

1. the dividend will be deemed to have been distributed by such other company from the profits most recently derived and available for distribution; and
2. where such other company derived its profits by way of dividends received or accrued to such company and by way of profits other than dividends, the dividend shall be deemed to have been declared by such other company on a proportionate basis from such profits.

(5) For the purposes of subsection (3)(b), where —

1. any dividend is declared by a company to any unit portfolio referred to in paragraph (e)(i) of the definition of "company" in section 1; and
2. such dividend is distributed by such unit portfolio by way of a dividend, or a portion of a dividend, to persons who have become entitled to such dividend by virtue of their being registered as holders of units in such unit portfolio,

such dividend contemplated in paragraph (a) will be deemed to have been declared by such company directly to such holders of units.

(6) Any resident who receives a foreign dividend or to whom a foreign dividend accrues may, notwithstanding the provisions of subsection (3), in respect of any year of assessment elect that the amount of such dividend to be included in the gross income of such resident shall —

1. if such resident holds for his own benefit at least 10 per cent of the equity share capital in the company, be the amount of such dividend after taking into account any foreign tax on income imposed in respect of such profit and any withholding tax paid in respect of such dividend; or
2. if such resident holds for his own benefit less than 10 per cent of the equity share capital in the company, be the amount of such dividend after taking into account any withholding tax paid in respect of such dividend,

and such election shall apply in respect of all foreign dividends received by or accrued to such resident during the year of assessment in respect of which the election was made.

(7) There shall be exempt from tax any foreign dividend declared or deemed to have been declared by —

1. any company which is a resident of the Republic which, during each of the three years of assessment preceding the year of assessment during which such dividend is declared or deemed to have been declared, derived 75 per cent or more of its total receipts or accruals from a source in the Republic or deemed to be from a source in the Republic;
2. any company incorporated in the Republic out of profits derived —

1. by way of dividends which accrued to such company prior to the effective date;
2. by such company through a branch outside the Republic —

27. if such profits were repatriated to the Republic prior to the effective date; or
28. in any other case, if such branch is situated in a designated country and the profit from which the dividend is distributed is subject to tax at a rate of at least 27 per cent;

1. any company listed on a stock exchange as defined in section 1 of the Stock Exchanges Control Act, 1985 (Act No. 1 of 1985), to a resident who, together with any connected person in relation to such resident, holds less than 10 per cent of the equity share capital of such company, if more than 10 per cent of the shareholding in such company is at the time of the declaration of such dividend held collectively by residents: Provided that where such company was not listed on such a stock exchange on the effective date, the exemption shall apply only upon approval by the Commissioner which approval the Commissioner may grant on application by such company, having regard to —

9. whether the profits of such company were generated in a designated country; and

(ii) the tax rate at which the profits from which the dividend was declared was or will be taxed;

1. any company, which is distributed to a resident who directly or indirectly holds for his own benefit at least 10 per cent of the equity share capital in the company, to the extent that the profits from which the dividend is declared —

9. were generated in a designated country; and

(ii) are or will be subject to tax at a rate of at least 27 per cent without any right of recovery (other than a right of recovery in terms of an entitlement to carry back losses arising during any year of assessment to any year of assessment prior to such year of assessment); or

1. any company to the extent that the profits from which the dividend is distributed have been or will be —

9. (i) included in the income of the shareholder of such company in terms of section 9D; or
10. (ii) taken into account in the determination of the taxable income of such company (other than profits derived by a unit portfolio referred to in paragraph (e)(i) of the definition of company in section 1, from any dividend which is exempt in terms of the provisions of section 10(1)(iA)).

(8) The Minister of Finance may, by way of notice in the Gazette, designate certain countries which —

1. have entered into an agreement with the Republic for the avoidance of double taxation and where such agreement is in force;
2. have a tax on income that is determined on a basis which is substantially the same as that of the Republic;
3. have a statutory rate of tax on income on companies of at least 27 per cent without any right of recovery of such tax by any person (other than a right of recovery in terms of an entitlement to carry back losses arising during any tax year to any tax year prior to such year of assessment); and
4. comply with any other requirement which the Minister of Finance may prescribe by regulation.

(9) The discretion of the Commissioner exercised in terms of this section shall be subject to objection and appeal.

(2) Subsection (1) shall be deemed to have come into operation on 23 February 2000, and apply in respect of any foreign dividend —

1. received by or accrued to any resident on or after that date; or
2. which accrued to the resident before 23 February 2000, but which is received on or after that date: Provided that the provisions of this paragraph shall not apply in respect of any dividend declared by a company before 23 February 2000, where―

9. such company is listed on a recognised stock exchange; or

(ii) in any other case, the chief executive officer and —

27. an external auditor of the company; or
28. where a company is situated in a country which does not require compulsory appointment of an external auditor, a registered public accountant of the same standing as a qualified chartered accountant,

has declared under oath or made a solemn declaration that such dividend was actually declared by the company before 23 February 2000.

. (1) Section 10 of the Income Tax Act, 1962, is hereby amended —

1. by the insertion after subparagraph (ii) of paragraph (cA) of subsection (1) of the following words:

"other than any institution, board, body or company, which is exempt from tax under the provisions of paragraph (cN) of this subsection:";

2. by the deletion of paragraphs (cB), (cC), (cD), (cF), (cI), (cJ) and (f) of subsection (1);
3. by the deletion of paragraph (cK) of subsection (1);
4. by the insertion after paragraph (cM) of subsection (1) of the following paragraph:

"(cN) the receipts and accruals of any public benefit organisation which has been approved by the Commissioner in terms of the provisions of section 30(2);";

5. by the substitution for paragraph (d) of subsection (1) of the following paragraph:

"(d) the receipts and accruals of any [terminating building society] —

9. pension fund, provident fund, retirement annuity fund; or

(ii) benefit fund [mutual savings bank], mutual loan association, fidelity or indemnity fund, trade union, chamber of commerce or industries (or an association of such chambers), local publicity association or non-proprietary stock exchange, approved by the Commissioner subject to such conditions as the Minister may prescribe by regulation; or

approved by the Commissioner subject to such conditions as the Minister may prescribe by regulation;";

9. by the substitution for paragraph (fA) of subsection (1) of the following paragraph:

"(fA) the receipts and accruals of any fund the sole object of which is to provide funds for any [body, such body being a company, society, association of persons or trust contemplated in paragraph (cF) or any religious, charitable or educational institution contemplated in paragraph (f),] —

1. public benefit organisation exempt from tax in terms of the provisions of section 10(1)(cN);
2. institution, board or body contemplated in section 10(1)(cA)(i), which carries on any public benefit activity approved by the Minister for purposes of section 18A; or
3. association of persons carrying on any public benefit activity in the Republic: Provided that —

27. the funds so provided does not exceed ten per cent of the gross receipts of the fund during any year of assessment; and
28. the fund take all reasonable steps to ensure that the funds are utilised for the purpose for which it has been provided,

if such fund —

[(i)](aa) has been approved by the Commissioner subject to such conditions as [he may deem necessary] the Minister may prescribe by way of regulation to ensure that no benefits are allocated by the fund for purposes other than the provision of funds for such a [fund] public benefit organisation, institution, board, body or association of persons;

[(ii)](bb) has submitted to the Commissioner a copy of the [written] constitution, will or any other written instrument under which it has been established and in terms of which it is —

[(aa)](A) not permitted to distribute any of its funds to any person other than such a [fund] public benefit organisation, institution, board, body or association of persons;

[(bb)](B) required to utilize its funds solely for the object for which it has been established or to invest such funds —

[(A)](AA) with a financial institution as defined in section 1 of the Financial Institutions (Investment of Funds) Act, 1984 (Act 39 of 1984);

[(B)](BB) in securities listed on a stock exchange as defined in section 1 of the Stock Exchanges Control Act, 1985 (Act 1 of 1985); or

[(C)](CC) in such other prudent financial instruments and investments as the Commissioner may approve;

[(cc)](C) required to distribute, unless the Commissioner, having regard to the distribution capacity, sustainability and the long-term needs and objectives of the fund, otherwise directs, at least 75 per cent of its net revenue (being the gross income of such fund less the costs of its administration) to any such [fund] public benefit organisation, institution, board, body or association of persons within a period of 12 months from the end of the financial year during which such net revenue was derived: Provided that in the case of any such fund which is approved in terms of the provisions of section 18A, net revenue shall include any donation in respect of which a receipt has been issued in terms of that section;

[(dd)](D) required on dissolution to transfer its assets to any such [body] public benefit organisation, institution, board, body, association of persons or any other fund approved in terms of this paragraph;

[(ee)](E) not permitted [except to the extent that the Commissioner directs] to carry on any [business] trading activity other than such activities that the Minister may prescribe by way of regulation;

[(ff)](F) required to submit to the Commissioner a copy of any amendment to the constitution, will or other written instrument under which it was established; and

[(gg)](G) not permitted to accept any donation which is [not irrevocable] revocable and [unconditional] conditional at the instance of the donor: Provided that the provisions of this item shall not prevent the donor from stipulating that the donation shall be used for a specific public benefit activity; [and

(hh) required to apply its net revenue, unless the Minister of Finance otherwise directs, for the furtherance of its sole object in the Republic]:

Provided that —

(a) where such constitution, will or other written instrument does not comply with the provisions of this subparagraph, it shall be deemed so to comply if―

1. in the case of a fund established under the terms of a will; or
2. in the case of a fund established prior to 21 June 1993 under a constitution or other written instrument which cannot be amended to comply with the said provisions,

the trustee of the fund furnishes the Commissioner with a written undertaking that the fund will be administered in compliance with the said provisions; and

(b) notwithstanding the provisions of subitems [(bb)](B) and [(ee)](E), any asset or business undertaking acquired by such fund by way of donation, inheritance or bequest, before 1 January 2001, may be retained or continued, as the case may be, in the form so acquired for a period of five years from that date:

Provided further that —

1. where the Commissioner is satisfied that any such fund has during any year of assessment failed to comply in any material respect with the provisions of this paragraph or the constitution, will or other written instrument in terms of which it has been established, he may after due notice withdraw his approval of the fund with effect from the commencement of that year of assessment;
2. where the Commissioner has withdrawn his approval of such fund, it shall, within [two] three months, or such longer period as the Commissioner may allow, from the date of such withdrawal, transfer, or take reasonable steps to transfer, its remaining assets to any such [body] public benefit organisation [which is exempt from tax under the provisions of paragraph (cF) or (f)];
3. where a fund fails to transfer, or take reasonable steps to transfer, its remaining assets as contemplated in paragraph (b) of this proviso, the accumulated net revenue which has not been distributed shall be deemed for the purposes of this Act to be an amount of taxable income which accrued to such fund during the year of assessment referred to in paragraph (a) of this proviso; [and]
4. any decision of the Commissioner in the exercise of his discretion under this paragraph shall be subject to objection and appeal;
5. any person who is in a fiduciary capacity responsible for the management or control of the income and assets of such fund, who with intent fails to comply with any provision of this Act or of the constitution, will or other written instrument under which such fund is established, shall be guilty of an offence and on conviction be liable to a fine or imprisonment not exceeding two years, or to both such fine and imprisonment; and
6. such fund complies with such reporting requirements as may be determined by the Commissioner.";
7. by the substitution for subparagraph (iii) of paragraph (hA) of subsection (1) of the following subparagraph:

"(iii) for the purposes of this paragraph, so much of any dividend as has been distributed by any unit portfolio constituting a company in terms of paragraph (e)(i) of the definition of 'company' in section 1 out of interest derived by such unit portfolio which is exempt from tax in the hands of such unit portfolio under the provisions of paragraph (iA), shall be deemed to be interest;";

8. by the deletion of subparagaph (i) of paragraph (hA) of subsection (1);
9. by the substitution for subparagraph (v) of paragraph (hA) of subsection (1) of the following subparagraph:

"(v) the exemption under this paragraph shall not apply to any interest received by or accrued to a company which is managed and controlled outside the Republic or any person other than a company who is not ordinarily resident in the Republic, if such interest is effectively connected with the business carried on by that company or person in the Republic;";

(i) by the substitution for subparagraph (xv) of paragraph (i) of subsection (1) of the following subparagraph:

"(xv) in the case of any taxpayer who is a natural person, so much of the aggregate of any dividends and interest received by or accrued to him which is not otherwise exempt from tax, as does not during the year of assessment exceed [the amount of R2000] —

27. in the case of any person who was or, had he lived would have been, at least 65 years of age on the last day of the year of assessment, the amount of R4 000; or
28. in any other case, the amount of R3 000:

Provided that the amount of the exemption from tax shall —

1. first apply in respect of any foreign dividends contemplated in section 9E received or accrued which would not otherwise have been exempt; and
2. in so far as such amount exceeds the amount of such foreign dividends, apply in respect of such interest and other taxable dividends received or accrued.";

(k) by the deletion of subparagraph (xvi) of paragraph (i) of subsection (1);

(l) by the substitution for paragraph (iA) of subsection (1) of the following paragraph:

"(iA) in the case of any unit portfolio referred to in paragraph (e)(i) of the definition of 'company' in section 1, so much of the interest or foreign dividends contemplated in section 9E received by or accrued to such unit portfolio as has been distributed, or as the Commissioner is satisfied will be distributed, by way of a dividend or a portion of a dividend, to persons who have become entitled to such dividend by virtue of their being registered as holders of units in such unit portfolio on a date falling on or after the first day of April, 1971;";

(m) by the addition of the word "or" at the end of subitem (B) of item (bb) of subparagraph (i) of paragraph (k) of subsection (1);

(n) by the addition to subparagraph (i) of paragraph (k) of subsection (1) of the following item:

"(cc) to the amount of any foreign dividend contemplated in section 9E received by or accrued to any resident as defined in section 9D as defined in section 9D;"; and

15. by the deletion of subparagraph (xii) of paragraph (t) of subsection (1).

(2)(a) Subsections (1)(a), (b), (d), (e) and (f) shall come into operation on a date to be determined by the President by way of proclamation in the Gazette: Provided that any company, society, trust, institution or other association of persons whose receipts and accruals were exempt from tax in terms of the provisions of paragraphs (cB), (cC), (cD), (cF), (cI), (cJ) and (f) of section 10(1) of the principal Act prior to the amendment thereof by this section, which company, society, trust, institution or other association of persons applies for approval by the Commissioner in terms of section 10(1)(cN) within …? months from the date so determined by the President, shall continue to enjoy exemption until written notification by the Commissioner of his decision in the exercise of his discretion in terms of such section 30 of the principal Act.

(b) Subsection (1)(c) and (o) shall be deemed to have come into operation on 1 January 2000 and shall apply in respect of any year of assessment commencing on or after that date.

(b) Subsection (1)(g) will be deemed to have come into operation on 23 February 2000.

(c) Subsection (1)(h) and (i) shall come into operation on the date of promulgation of this Act, and shall apply in respect of any interest which received or accrued on or after that date.

(d) Subsection (1)(k) will be deemed to have come into operation on ….

(e) Subsection (1)(l), (m) and (n) shall be deemed to have come into operation on 23 February 2000, and apply in respect of any foreign dividend —

9. received by or accrued to any resident on or after that date; or

(ii) which accrued to the resident before 23 February 2000, but which is received on or after that date: Provided that the provisions of this paragraph shall not apply in respect of any dividend declared by a company before 23 February 2000, where―

27. such company is listed on a recognised stock exchange; or
28. in any other case, the chief executive officer and —

1. the external auditor of the company; or
2. where a company is situated in a country which does not require compulsory appointment of an external auditor, a registered public accountant of the same standing as a qualified chartered accountant,

has declared under oath or made a solemn declaration that such dividend was actually declared by the company before 23 February 2000.

. (1) Section 11 of the Income Tax Act, 1962, is hereby amended —

1. by the insertion after paragraph (c) of the following paragraph:

"(cA) an allowance in respect of any amount actually incurred by such person in the course of the carrying on his trade, as compensation in respect of any restraint of trade imposed on any other person who —

1. is a natural person;
2. is or was a labour broker as defined in the Fourth Schedule (other than a labour broker in respect of which a certificate of exemption has been issued in terms of such Schedule);
3. is or was a personal service company as defined in the Fourth Schedule; or
4. is or was a personal service trust as defined in the Fourth Schedule,

27. so much of such amount so incurred as is equal to such amount divided by the number of years, or part thereof, during which the restraint of trade shall apply; or
28. one-third of such amount so incurred."; and

1. by the substitution for paragraph (o) of the following paragraph:

"save as provided in paragraph 12(2) of the First Schedule, an allowance in respect of¾

9. any building (or portion thereof) referred to in section 13(1) or (4) or section 13bis(1) or section 27(2)(b) or of any improvements (or portion thereof) to such building; or

(ii) [of] any shipbuilding structure referred to in section 13(8) or of any improvement to such shipbuilding structure; or

(iii) [of] any residential unit referred to in section 13ter; or

1. [of] any permanent work, road pavement or ancillary service referred to in section 24G; or
2. [of] any machinery, plant, implements, utensils or articles used by the taxpayer for the purposes of his trade; or
3. any transmission line or cable or railway line referred to in section 12D,

which have been scrapped by such taxpayer during the year of assessment, such allowance to be the excess of the original cost to such taxpayer of such building (or portion thereof) or such improvements (or portion thereof) to such building or such shipbuilding structure or such improvements to such shipbuilding structure or such residential unit or such permanent work, road pavement or ancillary service or such machinery, plant, implements, utensils or articles or such transmission line or cable or railway line over the total amount arrived at by adding all the allowances made in respect thereof under the provisions of paragraph (e) of this section, or section 12(1), or section 12(1) as applied by section 12(3), or section 12A(2), or section 12B, or section 12C, or section 12D, or section 13(1), or section 13(1) as applied by section 13(4) or (8), or section 13bis (1), (2) or (3), or section 13ter(2) or (3), or section 14(1) (a) or (b), or the corresponding provisions of any previous Income Tax Act, or section 14bis(1)(a), (b) or (c), or section 24F, or section 24G, or section 27(2)(b) or (d), to any amount or the value of any advantage accruing to the taxpayer in respect of the sale or other disposal of such building, shipbuilding structure, improvements, residential unit, permanent work, road pavement, ancillary service, machinery, plant, implements, utensils or articles or transmission line or cable or railway line: Provided that¾

1. no allowance shall be made in the case of any such building (or portion thereof) or of any such improvements (or portion thereof) to such building or of any such shipbuilding structure or of any such improvements to such shipbuilding structure or of any such residential unit or of any transmission line or cable or railway line which has or have been scrapped within a period of ten years from the date of erection or purchase, or in the case of any such residential unit in respect of which any amount has fallen for inclusion in the taxpayer's income under the provisions of section 13ter(7)(a), whether in the current or in any previous year of assessment;

for the purposes of this paragraph the cost of any building (or portion thereof) or of any improvements (or portion thereof) to any building or of any shipbuilding structure or of any improvements to any shipbuilding structure or of any such residential unit or of any transmission line or cable or railway line shall be deemed to be that portion of the actual cost on which the allowance in question was made;".

1. by the substitution for subitem (B) of item (dd) of the proviso to paragraph (w) of the following subitem:

"(B) the only benefit payable under the policy is a benefit payable within a period fixed in such policy upon or by reason of the death or disablement of the employee or director whose life is insured under the policy or the policy is a [personal accident] disability policy as defined in section 1 of the [Insurance Act, 1943 (Act 27 of 1943)] Long-term Insurance Act, 1998 (Act No. 52 of 1998); or";

2. by the substitution for item (ff) of the proviso to paragraph (w) of the following item:

"(ff) no deduction shall be made from the income of any taxpayer in respect of premiums paid by him under any policy of insurance of which he is the owner on the life of an employee of that taxpayer or, where the taxpayer is a company, of a director or employee of that company, except in so far as an allowance may be made under this paragraph or, in the case of a policy which is not a life policy or a [personal accident] disability policy as defined in section 1 of the [Insurance Act, 1943] Long-term Insurance Act, 1998 (Act No. 52 of 1998), a deduction which may, in appropriate circumstances, be made under paragraph (a) or (b) of this section;".

(2)(a) Subsection (1)(a) shall be deemed to have come into operation on 23 February 2000, and shall apply in respect of any amount incurred on or after that date.

(b) Subsection (1)(b) shall come into operation on 23 February 2000, and shall apply in respect of any transmission line or cable or railway line contracted for on or after that date.

. The following section is hereby inserted after section 12C of the Income Tax Act, 1962:

"Deduction in respect of certain pipelines, transmission lines and railway lines.

"affected asset" means any¾

1. pipeline used for the transportation of natural oil and refined by-products of such natural oil;
2. line or cable used for the transmission of electricity;
3. telephone line or cable used for the transmission of any signal for purposes of telecommunication; and
4. railway line used for the transportation of persons, goods or things,

contracted for on or after the effective date, and the construction, erection or installation of which commenced on or after such date and includes any earthworks or supporting structures forming part of such pipeline, transmission line or cable or railway line; and

"effective date" means 23 February 2000.

(2) In respect of any new and unused affected asset which¾

1. is owned by the taxpayer and is brought into use for the first time by such taxpayer on or after the effective date; and
2. is used directly by such taxpayer —

1. in the production of income; and
2. in carrying on its sole business of —

27. the transportation of persons, goods, things or natural oil or refined by-products of such natural oil; or
28. the transmission of electricity or any telecommunication signal,

there shall be allowed to be deducted an allowance in respect of the cost actually incurred by the taxpayer in respect of the acquisition of such asset.

(3) The allowance contemplated in subsection (2) shall not for any one year exceed¾

1. 10 per cent of the cost incurred in respect of any asset contemplated in paragraph (a) of the definition of "affected asset"; or
2. 5 per cent of the cost incurred in respect of any asset contemplated in paragraph (b), (c) or (d) of the definition of "affected asset".

(4) For the purposes of this section the cost to a taxpayer of any affected assets shall be deemed to be¾

1. where such asset has been acquired to replace any asset which has been damaged or destroyed, the actual cost of such asset, less any amount which has been recovered or recouped in respect of the damaged or destroyed asset which has been excluded from the taxpayer’s income in terms of section 8(4)(e), whether in the current or any previous year of assessment; or
2. in any other case, the lesser of¾

1. the actual cost of acquisition of the asset incurred by the taxpayer; or
2. the cost which a person would, if he had acquired the said asset under a cash transaction concluded at arm’s length on the date on which the transaction for the acquisition of the said asset was in fact concluded, have incurred in respect of the direct cost of acquisition of the asset (including the direct cost of the installation or erection thereof).

(5) No deduction shall be allowed under this section in respect of any affected asset which has been disposed of by the taxpayer during any previous year of assessment.

(6) The deductions which may be allowed in terms of this section and any other provision of this Act in respect of the cost of any affected asset shall not in the aggregate exceed the amount of such cost."

. (1) Section 18A of the Income Tax Act, 1962, is hereby substituted by the following section:

"(1) There shall be allowed to be deducted from the taxable income of any taxpayer so much of the sum of any bona fide donations in cash or in kind made by such taxpayer and actually paid or transferred during the year of assessment to —

1. any —

(i) public benefit organisation approved by the Commissioner in terms of section 30; or

1. institution, board or body contemplated in section 10(1)(cA)(i),

which carries on any public benefit activity which is approved by the Minister by way of notice in the Gazette for the purposes of this section, a copy of which shall be laid upon the Table in Parliament;

1. any fund which is approved by the Commissioner under the provisions of section 10(1)(fA), which provides funds solely to any public benefit organisation, institution, board or body contemplated in paragraph (a),

as does not exceed the greater of —

27. five per cent of the taxable income of such taxpayer as calculated before allowing any deduction under this section or section 18; or
28. R1 000.

(2) Any claim for a deduction in respect of any donation under subsection (1) shall not be allowed unless supported by a receipt issued by the public benefit organisation, institution, board, body or fund concerned, on which the following details are given, namely —

1. the reference number of the public benefit organisation, institution, board, body or fund issued by the Commissioner for the purposes of this section;
2. the date of the receipt of the donation;
3. the name of the public benefit organisation, institution, board, body or fund which received the donation, together with an address to which enquiries may be directed in connection therewith;
4. the name and address of the donor;
5. the amount of the donation or the nature of the donation (if not made in cash);
6. a certification to the effect that the receipt is issued for the purposes of section 18A of the Income Tax Act, 1962, and that the donation has been or will be used exclusively for the object of the public benefit organisation, institution, board, body or fund concerned.

(3) If any deduction is claimed by any taxpayer under the provisions of subsection (1) in respect of any donation of property in kind, the amount of such deduction shall be deemed to be an amount equal to —

1. where such property constitutes trading stock of the taxpayer (including any livestock or produce in respect of which the provisions of paragraph 11 of the First Schedule are applicable), the amount which has been taken into account for the purposes of section 22(8) or, in the case of such livestock or produce, the said paragraph 11, in relation to the donation of such property; or
2. where such property (other than trading stock) constitutes an asset used by the taxpayer for the purposes of his trade, the cost to the taxpayer of such property less any allowance (other than any investment allowance) allowed to be deducted from the income of the taxpayer under the provisions of this Act in respect of that asset; or
3. where such property does not constitute trading stock of the taxpayer or an asset used by him for the purposes of his trade, the cost to the taxpayer of such asset, less, in the case of a movable asset which has deteriorated in condition by reason of use or other causes, a depreciation allowance calculated in the manner contemplated in section 8(5)(bB)(i); or
4. where such property is purchased, manufactured, erected, assembled, installed or constructed by or on behalf of the taxpayer in order to form the subject of the said donation, the cost to the taxpayer of such property.

(4) The provisions of subsections (6) and (7) of section 30 shall apply mutatis mutandis in respect of any institution, board, body or fund contemplated in subsection (1)(a) or (b).

(5) If the Commissioner has reasonable grounds for believing that any person who is in a fiduciary capacity responsible for the management or control of the income or assets of any public benefit organisation, institution, board, body or fund has with intent —

1. in any way failed to carry out the objects for which the public benefit organisation, institution, board, body or fund was established or has expended moneys belonging to the public benefit organisation, institution, board, body or fund for purposes not covered by such objects; or
2. issued a receipt to any taxpayer for purposes of this section in respect of any fees or other emoluments payable to such organisation, institution, board, body or fund by such person,

the Commissioner may by notice in writing addressed to that member, trustee, director or other responsible person direct that donations to such fund shall not qualify for deduction under the provisions of this section in respect of any year of assessment specified in such notice, and any claim by any taxpayer for such deduction shall accordingly be disallowed.".

(2) Subsection (1) shall —

1. in so far as it determines the limit of the deduction as contemplated in section 18A(1), be deemed to have come into operation in respect of years of assessment commencing on or after 1 March 2000; and
2. in so far as it amends the rest of section 18A, come into operation on a date to be determined by the President by proclamation in the Gazette.

. (1) Section 19 of the Income Tax Act, 1962, is hereby repealed.

(2) Subsection (1) shall come into operation on …

. Section 20 of the Income Tax Act, 1962, is hereby amended by the addition to subsection (1) of the following proviso:

"Provided that there shall not be set off against any amount of assets distributed to such person by any pension fund which is included in the gross income of such person in terms of paragraph (eB) of the definition of "gross income" in section 1, any—

1. balance of assessed loss; or
2. any "assessed loss" as defined in subsection (2) incurred in such year before taking into account any amount of such assets.".

. (1) Section 22 of the Income Tax Act, 1962, is hereby amended —

1. by the substitution of subsection (5) of the following subsection:

"(5) No person may for the purpose of determining the cost price of any trading stock, adopt the basis of trading stock valuation whereunder the last item of any class of trading stock acquired by him on any date is deemed to be the first item of that class of trading stock disposed of by him on or after that date."; and

2. by the deletion of subsection (5A).

(2) Subsection (1) shall come into operation with effect from years of assessment commencing on or after 1 January 2000.

. (1) Section 23 of the Income Tax Act, 1962, is hereby amended —

(a) by the substitution for paragraph (d) of the following paragraph:

"(d) any tax, duty, levy, interest or penalty imposed under this Act, any additional tax imposed under section 60 of the Value-Added Tax Act, 1991 (Act 89 of 1991), and any interest or penalty payable in consequence of the late payment of any tax, duty or levy payable under any Act administered by the Commissioner, the Regional Services Councils Act, 1985 (Act 109 of 1985), [and] the KwaZulu and Natal Joint Services Act, 1990 (Act 84 of 1990) and the Skills Development Levies Act, 1999 (Act No. 9 of 1999);"; and

(b) by the addition of the following paragraphs:

"(k) any expense incurred by¾

(l) any expense incurred in respect of the payment of any restraint of trade, except as provided for in section 11(cA).".

(2)(a) Subsection (1)(a) shall come into operation on 1 April 2001 and shall apply in respect of any year of assessment commencing on or after that date.

(b) Subsection (1)(b) shall be deemed to have come into operation on 23 February 2000, and shall apply in respect of any amount incurred on or after that date.

. Section 23B of the Income Tax Act, 1962, is hereby amended by the substitution for subsection (1) of the following subsection:

"(1) Where, but for the provisions of this subsection, an amount qualifies or has qualified for a deduction or an allowance, or is otherwise taken into account in determining the taxable income of any person, under more than one provision of this Act, such amount [or a deduction or allowance in respect of such amount] or any portion thereof, shall not be allowed or taken into account more than once in the determination of the taxable income of any person.".

. (1) Section 23F of the Income Tax Act, 1962, is hereby substituted by the following section:

"Acquisition or disposal of trading stock¾

23F. (1) Where any taxpayer has during any year of assessment actually incurred expenditure for the acquisition of trading stock which was neither disposed of by him during such year nor held by him at the end of such year, any deduction which may be allowed to him under the provisions of section 11(a) or (b) in respect of such expenditure shall not be allowed in such year, but such expenditure shall for the purposes of such provisions be deemed to have been incurred by him in the first subsequent year of assessment in which¾

1. such trading stock is disposed of by him;
2. the value of such trading stock falls to be included in his income under the provisions of section 22(1); or

(c) it is shown by him that by reason of the loss or destruction of such trading stock or the termination of the agreement in terms of which such trading stock was acquired by him or for any other reason, such trading stock will neither be disposed of nor held by him,

to the extent that such expenditure has been actually paid by such taxpayer.

(2) Where any taxpayer has during any year of assessment disposed of any trading stock in the ordinary course of his trade for any consideration the full amount of which will not accrue to him during such year of assessment and any expenditure incurred in respect of the acquisition of such trading stock was allowed as a deduction under the provisions of section 11(a) or (b) during such year or any previous year of assessment, the amount of such expenditure so allowed as a deduction shall be deemed to have been recovered or recouped by such taxpayer and be included in the income of the taxpayer for the year of assessment during which such trading stock was so disposed of and there shall be allowed to be deducted in —

1. such year, so much of such expenditure which bears to the full amount of such expenditure, the same ratio as the amount of such consideration which has accrued to the taxpayer during such year bears to the full amount of such consideration;
2. any subsequent year of assessment, so much of such expenditure which bears to the full amount of such expenditure, the same ratio as the amount of such consideration which has accrued to the taxpayer during such subsequent year bears to the full amount of such consideration; or
3. any year of assessment during which it is shown by such taxpayer that the consideration will never accrue to him, so much of such expenditure as has not been allowed as a deduction in terms of the provisions of paragraph (a) or (b), to the extent that such expenditure was actually paid.

(3) Where any taxpayer has during any year of assessment in the ordinary course of his trade disposed of any right or interest in any asset which constitutes trading stock —

1. which has the effect that the remaining right or interest in such asset held and not disposed of will not be included in trading stock at the end of such year; and
2. any expenditure incurred in respect of the acquisition of such asset was allowed as a deduction under the provisions of section 11(a) or (b) during such year or any previous year of assessment,

there shall be deemed to have been recovered or recouped by such taxpayer and be included in the income of such taxpayer for such year of assessment, so much of such expenditure as relates to the right or interest contemplated in paragraph (a).".

(2) Subsection (1) shall be deemed to have come into operation on 23 February 2000, and shall apply in respect of trading stock disposed of on or after that date.

. (1) The following section is hereby inserted after section 23G of the Income Tax Act, 1962:

"Limitation of certain deductions¾

23H. (1) Where any person has during any year of assessment actually incurred any expenditure (other than expenditure incurred in respect of the acquisition of any trading stock) —

1. which is allowable as a deduction in terms of the provisions of section 11(a), (b), (c) or (d); and
2. in respect of goods, services or any other benefit, all of which will not be supplied or rendered to such person, or the full benefit of which such person will not become entitled to during such year of assessment,

the amount of the expenditure which shall be allowable as a deduction in terms of such section in the said year and any subsequent year of assessment, shall be limited to, in the case of expenditure incurred in respect of —

1. goods to be supplied, so much of the expenditure as relates to the goods actually supplied to such person in such year of assessment; or
2. services to be rendered, an amount which bears to the total amount of such expenditure the same ratio as the number of months in such year during which such services are rendered bears to the total number of months during which such services will be rendered; or
3. any other benefit to which such person will become entitled, an amount which bears to the total amount of such expenditure the same ratio as the number of months in such year during which such person will be entitled to such benefit bears to the total number of months during which such person will be entitled to such benefit:

Provided that the provisions of this section shall not apply —

27. where all the goods or services are to be supplied or rendered within 6 months after the end of the year of assessment during which the expenditure was incurred, or such person becomes entitled to the full benefit in respect of which the expenditure was incurred within such period; or
28. where the aggregate of all amounts of expenditure incurred by such person, which would otherwise be limited by this section, does not exceed R50 000; or
29. to any expenditure to which the provisions of section 24I, 24J, 24K or 24L applies; or
30. to any expenditure actually paid in respect of any unconditional liability to pay an amount imposed by legislation.

(2) If the Commissioner is in any case satisfied that the apportionment of the expenditure in accordance with subsection (1) does not reasonably represent a fair apportionment of such expenditure in respect of the goods, services or benefits to which it relates, he may direct that such apportionment be made in such other manner as to him appears fair and reasonable.

(3) Notwithstanding the provisions of subsections (1) and (2), where it is during any year of assessment shown by any person that —

1. the goods or services in respect of which the expenditure is incurred will never be received by or be rendered to such person; or
2. such person will never become entitled to such other benefit in respect of which any expenditure is incurred,

such expenditure shall be allowed in such year, to the extent that such expenditure has been actually paid by such person.

(4) The exercise by the Commissioner of his discretion contemplated in subsection (2) shall be subject to objection and appeal.".

(2) Subsection (1) shall come into operation on 23 February 2000, and shall apply in respect of any expenditure incurred on or after that date.

. Section 24B of the Income Tax Act, 1962, is hereby repealed.

. Section 28 of the Income Tax Act, 1962, is hereby amended —

1. by the substitution for the heading of the following heading:

"Determination of taxable income derived from short-term insurance business. —";

2. by the deletion of subsections (1), (1A), (1B) and (1C);
3. by the substitution for subsection (3) of the following subsection:

"(3) Nothing in this section contained shall be construed as relieving any taxpayer from the obligation to render returns of any income derived otherwise than from the carrying on of [long-term or] short-term insurance business or in the form of dividends [(notwithstanding the inclusion of such dividends or of a portion thereof in the gross amounts referred to in subsection (1))] or from any liability for taxation in respect of any taxable income so derived or as depriving the taxpayer of the right to set off against the taxable income derived from the business of insurance any loss incurred in respect of any other business or any balance of loss so incurred which the taxpayer would be entitled to set off under the provisions of section 20.";

4. by the deletion of the definition of "long-term insurance business" in subsection (4);
5. by the substitution for the definition of "short-term insurance business" in subsection (4) of the following definition:

"’short-term insurance business’ means any short-term insurance business [other than long-term insurance business] as defined in the Short-term Insurance Act, 1998 (Act no. 53 of 1998).".

. Section 28bis of the Income Tax Act, 1962, is hereby amended by the substitution for paragraph (b) of subsection (1) of the following paragraph:

"(b) that at the time the arrangement was implemented, all the issued shares of the subsidiary were held for its own benefit by the foreign company or a company which was incorporated, managed and controlled outside the Republic and was controlled by or controlled the foreign company, [or that the arrangement was implemented in order to meet the requirements of section 3quat of the Insurance Act, 1943 (Act 27 of 1943)]".

. (1) The following section is hereby inserted after section 29A of the Income Tax act, 1962:

"Public benefit organisations —

30. (1) For the purposes of this section and the Act —

‘public benefit activity’ means any activity which has been determined by the Minister of Finance, having regard to the material, charitable, spiritual, cultural, physical, educational, environmental or moral interests and well-being of the general public, as an approved activity by way of notice in the Gazette, a copy of which shall be laid upon the Table in Parliament;

‘public benefit organisation’ means any organisation of a public character,

1. which is a company formed and incorporated under section 21 of the Companies Act, 1973 (Act No. 61 of 1973), a trust or an association of persons;
2. the sole object of which is the carrying on in an altruistic manner of one or more public benefit activity in the Republic; and
3. which has, within such period as the Commissioner may determine, been registered in terms of section 13(5) of the Non-profit Organisations Act, 1997 (Act No. 71 of 1997), and complied with any other requirements imposed in terms of such Act.

(2) The Commissioner shall for the purposes of this Act, approve a public benefit organisation which —

1. complies with such conditions as the Minister may prescribe by way of regulation to ensure that the activities and resources of such organisation are wholly, or substantially the whole of which is, directed to the furtherance of its public benefit activities in the Republic;
2. has submitted to the Commissioner a copy of the constitution, will or any other written instrument under which it has been established and in terms of which it is —

(i) required to have at least three members or trustees, who are not connected persons in relation to each other, to accept the fiduciary responsibility of such organisation;

(ii) subject to paragraph (d) not permitted to distribute any of its funds to any person and is required to utilise its funds solely for the object for which it has been established, or to invest such funds —

27. with a financial institution as defined in section 1 of the Financial Institutions (Investment of Funds) Act, 1984 (Act No. 39 of 1984);
28. in securities listed on a stock exchange as defined in section 1 of the Stock Exchanges Control Act, 1985 (Act No. 1 of 1985); or
29. in such other prudent financial instruments and investments as the Commissioner may approve;

1. required on dissolution to transfer its assets to any similar public benefit organisation which is exempt or will qualify for exemption under the provisions of this section;
2. not permitted to carry on any trading activity other than such activities that the Minister may prescribe by way of regulation; and
3. not permitted to accept any donation which is revocable and conditional at the instance of the donor: Provided that this paragraph shall not prevent the donor from stipulating that the donation shall be used for a specific public benefit activity;

1. the Commissioner is satisfied is or was not knowingly a party to, or does not knowingly permit, or has not knowingly permitted, itself to be used as part of any transaction, operation or scheme of which the sole or main purpose is or was the reduction, postponement or avoidance of liability for any tax, duty or levy which, but for such transaction, operation or scheme, would have been or would have become payable by any person under this Act or any other Act administered by the Commissioner;
2. has not paid any remuneration to any employee, office bearer, member or other person which in the opinion of the Commissioner is excessive, having regard to what is generally considered reasonable in the sector and in relation to the service rendered;
3. complies with such reporting requirements as may be determined by the Commissioner; and
4. required to submit to the Commissioner a copy of any amendment to such constitution, will or other written instrument:

Provided that notwithstanding subparagraphs (ii) and (iv) of paragraph (b), any asset or business undertaking acquired by such organisation before 1 January 2001, by way of donation, inheritance or bequest may be retained or continued, as the case may be, in the form so acquired for a period of five years from that date.

(3) Where the Commissioner is satisfied that any public benefit organisation approved under subsection (2) has during any year of assessment failed to comply with the provisions of this section, or the constitution, will or other written instrument under which it is established, he may withdraw his approval of the organisation with effect from the commencement of that year of assessment.

(4) Where the Commissioner has withdrawn his approval of such organisation as contemplated in subsection (3), such organisation shall, within three months from the date of such withdrawal, transfer, or take reasonable steps to transfer, its remaining assets to any other organisation which is —

1. exempt from tax under this section; and
2. not a connected person in relation to such organisation.

(5) Where any organisation fails to transfer, or take reasonable steps to transfer, its remaining assets as contemplated in subsection (4), the accumulated net revenue which has not been distributed shall be deemed for the purposes of this Act to be an amount of taxable income which accrued to such organisation during the year of assessment referred to in subsection (3).

(6) Any books of account, records or other documents relating to any public benefit organisation shall —

1. where kept in book form, be retained and carefully preserved by any person in control of such fund for a period of four years from the date of the last entry in any book; or
2. where not kept in book form, be retained and carefully preserved by any person in control of such public benefit organisation for a period of four years after completion of the transactions, acts or operations to which they relate.

(7) In the application of the provisions of this Act, the Commissioner may by notice in writing require any person whom the Commissioner may deem able to furnish information in regard to such organisation —

1. to answer any questions relating to such public benefit organisation; or
2. to make available for inspection by the Commissioner or any person appointed by him, any book of account, records or other documents relating to such public benefit organisation; or

to attend at the time and place appointed by the Commissioner for the purposes of producing for examination by the Commissioner or any person appointed by him, any books of account, records or other documents relating to such public benefit organisation.

(8) Any decision of the Commissioner in the exercise of his discretion under this section shall be subject to objection and appeal.

(9) Any person who is in a fiduciary capacity responsible for the management or control of the income and assets of such public benefit organisation who with intent fails to comply with any provision of this section or of the constitution, will or other written instrument under which such organisation is established, shall be guilty of an offence and on conviction be liable to a fine or imprisonment not exceeding two years, or to both such fine and imprisonment.".

(2) Subsection (1) shall come into operation on a date to be determined by the President by proclamation in the Gazette.

. (1) Section 38 of the Income Tax Act, 1962, is hereby amended by the substitution for paragraph (i) of subsection (2) of the following paragraph:

"(i) any unit portfolio referred to in paragraph (e)(i) of the definition of 'company' in section one.".

(2) Subsection (1) shall be deemed to have come into operation on 23 February 2000.

. Section 55 of the Income Tax Act, 1962, is hereby amended by the substitution for paragraph (k) of subsection (2) by the following paragraph:

"(k) There shall be no appearance by or on behalf of either party before the Board, whose decision shall be [final and shall be] communicated in duplicate to the Commissioner who shall forward one copy thereof to the donor.".

. (1) Section 56 of the Income Tax Act, 1962, is hereby amended —

1. by the substitution for paragraph (h) of subsection (1) of the following paragraph:

"(h) by or to any person (including any government) referred to in section 10(1)(a), (b), (cA), [(cB), (cC), (cD)], (cE), [(cF), (cI), (cJ), (cL)], (cN), (d), (e) or (fA);";

2. by the deletion of paragraphs (i) and (j) of subsection (1).

(2) Subsection (1) shall come into operation on a date to be determined by the President by way of proclamation in the Gazette, and shall apply in respect of any donation made on or after that date.

. (1) Section 64B of the Income Tax Act, 1962, is hereby amended —

1. by the substitution for the words preceding the proviso to subsection (3) of the following words:

"The net amount of any dividend referred to in subsection (2) shall be the amount by which such dividend declared by a company exceeds the sum of any dividends (other than any dividends contemplated in subsection (5)(b), (c), (d) and (f) or any foreign dividends as defined in section 9E, but including foreign dividends which are exempt in terms of section 9E(7)(a), (b), (c), (d), (e) or (f)(ii)) which have during the dividend cycle in relation to such firstmentioned dividend accrued to the company:";

2. by the substitution for paragraph (d) of subsection (5) of the following paragraph:

"(d) so much of any dividend declared by a unit portfolio referred to in paragraph (e)(i) of the definition of 'company' in section 1 as represents a distribution of interest or of dividends referred to in section 11(s) received by or accrued to such unit portfolio;"; and

3. by the substitution for paragraph (j) of subsection (5) of the following paragraph:

"(j) any dividend declared by a company contemplated in paragraph (e)(i) of the definition of 'company' in section 1.".

(2)(a) Subsection (1)(a) shall be deemed to have come into operation on 23 February 2000, and apply in respect of any foreign dividend —

(i) received by or accrued to any resident on or after that date; or

(ii) which accrued to the resident before 23 February 2000, but which is received on or after that date: Provided that the provisions of this paragraph shall not apply in respect of any dividend declared by a company before 23 February 2000, where —

27. such company is listed on a recognised stock exchange; or
28. in any other case, the chief executive officer and the external auditor of the company has declared under oath or made a solemn declaration that such dividend was actually declared by the company before 23 February 2000.

(b) Subsection (1)(b) and (c) shall be deemed to have come into operation on 23 February 2000.

. (1) Section 64C of the Income Tax Act, 1962, is hereby amended —

1. by the substitution for paragraph (b) of the definition of "recipient" in subsection (1) of the following paragraph:

"(b) any [relative of such] connected person in relation to a shareholder; or"; and

2. by the deletion of paragraph (c) of the definition of "recipient" in subsection (1).

(2) Subsection (1) shall come into operation on …

. (1) Section 66 of the Income Tax Act, 1962, is hereby amended by the substitution for item (aa) of subparagraph (ii) of paragraph (b) of subsection (1) of the following item:

"(aa) any amount derived by way of interest or dividends [contemplated in section 19(5A)] that are not exempt from tax if the aggregate of such interest and dividends [exceeded R2000] —

1. in the case of any person who was, or had he lived would have been, at least 65 year of age in the last day of the year of assessment, exceeded R4 000; or
2. in any other case, exceeded R3 000; or".

(2) Subsection (1) shall come into operation on …

. Section 70 of the Income Tax Act, 1962, is hereby amended by the substitution for subsection (2) of the following subsection:

"(2) Where, during any period of twelve months ending on the last day of February in any year, any cash or any asset the amount or value of which in whole or part constitutes a dividend as defined in section 1, is given to shareholders in any company or a company distributes to shareholders any amount which constitutes a dividend so defined, whether by way of an award of capitalization shares or bonus debentures or securities or otherwise, the company concerned shall, within thirty days after the end of the said period, or within such further period as the Commissioner may allow —

1. furnish the Commissioner with a return giving the full name and address of each shareholder and the amount of the dividend accruing to such shareholder; and

(b) where such dividend represents an amount of any foreign dividend ass determined in accordance with the provisions of section 9E and such company is a resident as defined in section 9C, notify each shareholder who is a resident of the amount of such foreign dividend.".

. Section 74C of the Income Tax Act, 1962, is hereby amended —

1. by the substitution for paragraph (b) of subsection (8) of the following paragraph:

"(b) have the same powers —

(i) to enforce the attendance of witnesses and to compel them to give evidence or to produce evidential material; and

(ii) relating to contempt,

as are vested in a President of the Special Court contemplated in section 83; and".

(b) by the substitution for subsections (11), (12) and (13) of the following subsections:

"(11) Any person whose affairs are investigated in the course of an inquiry contemplated in this section, shall be entitled to be present [throughout] at the inquiry during such time as his affairs are investigated, unless on application by the person contemplated in subsection (1), the presiding officer directs otherwise on the ground that the presence of the person and his representative, or either of them, would be prejudicial to the effective conduct of the inquiry.

(12) Any person contemplated in subsection (9) has the right to [a representative of his choice] have a legal representative present during the time that he appears before the presiding officer.

(13) An inquiry contemplated in this section shall [not be public] be private and confidential and the presiding officer shall at any time on application [of] by the person whose affairs are investigated or any other person giving evidence or the person contemplated in subsection (1), exclude from such inquiry or require to withdraw therefrom, all or any persons whose attendance is not necessary for the inquiry.";

1. by the substitution for subsection(15) of the following subsection:

"(15) The provisions with regard to the preservation of secrecy contained in section 4 shall mutatis mutandis apply to any person present at the questioning of any person contemplated in subsection (9), including the person being questioned.";

2. by the addition after subsection (15) of the following subsections:

"(16) Any person who fails to comply with the provisions of subsection (15) shall be guilty of an offence and on conviction shall be liable to a fine or to imprisonment for a period not exceeding two years or to both such fine and imprisonment.

(b) having been sworn or having made an affirmation—

(i) fails to answer fully and to the best of his or her ability any question lawfully put to him or her; or

shall be guilty of an offence.

(19)(a) No person may refuse to answer any question on the grounds that it may incriminate him or her.

(b) No such incriminating evidence shall be admissible in any criminal proceedings against the person giving such evidence, other than in proceedings where that person stands trial on a charge relating to the administering or the giving of false evidence or the making of a false statement in connection with such questions and answers, or a failure to answer lawful questions fully and satisfactorily, or a charge in connection with a breach of the provisions of subsection (15).

(20) An inquiry in terms of this section shall proceed notwithstanding the fact that any civil or criminal proceedings are pending or contemplated against or involving any person identified in subsection (6)(c) or any witness or potential witness or any person whose affairs may be investigated in the course of that inquiry.".

. Section 75 of the Income Tax Act, 1962, is hereby amended by the substitution for the words following paragraph (g) of subsection (1) of the following words:

"shall be guilty of an offence and liable on conviction to a fine [not exceeding R2000] or to imprisonment for a period not exceeding 12 months or to both such fine and such imprisonment.".

. Section 83 of the Income Tax Act, 1962, is hereby amended —

1. by the substitution for subsection (19) of the following subsection:

"(19)[(a)] The President of the court may indicate which judgments or decisions of the court he considers ought to be published for general information, in such form as does not reveal the identity of the appellant."; and

2. by the deletion of paragraphs (b) and (c).

. Section 84 of the Income Tax Act, 1962, is hereby amended by the substitution for subsection (2) of the following subsection:

"(2) If any person who has been duly subpoenaed to give evidence at the hearing of an appeal or to produce any book, record, document or thing in his possession or under his control, fails without reasonable cause to attend or to give evidence or to produce that book, record, document or thing according to the subpoena or, unless excused by the President of the court, to remain in attendance throughout the proceedings, the President of the court may, upon being satisfied upon oath or by the return of the person by whom the subpoena was served, that such person has been duly subpoenaed and that his reasonable expenses have been paid or offered to him, impose upon the said person a fine [not exceeding fifty rand] or in default of payment imprisonment for a period not exceeding three months.".

. Section 85 of the Income Tax Act, 1962, is hereby amended by the substitution for subsection (1) of the following subjection:

"(1) If during the sitting of a special court, any person wilfully insults a member of the court or any officer of the court attending at the sitting, or wilfully interrupts the proceedings of the court or otherwise misbehaves himself in the place where the court is held, the President of the court may make an order committing that person to imprisonment for any period not exceeding three months or order that person to pay a fine [not exceeding one hundred rand] or in default of payment thereof to be imprisoned for such a period.".

. Section 99 of the Income Tax Act, 1962, is hereby substituted by the following section:

"The Commissioner may, if he thinks necessary, declare any person to be the agent of any other person, and the person so declared an agent shall be the agent for the purposes of this Act and may be required to make payment of any tax, interest or penalty due from any moneys, including pensions, salary, wages or any other remuneration, which maybe held by him or due by him to the person whose agent he has been declared to be.".

. (1) Section 101 of the Income Tax Act, 1962, is hereby amended by the substitution for subsection (1) of the following subsection:

"(1) Every company carrying on business or having an office in the Republic and every unit portfolio constituting a company in terms of paragraph (e)(i) of the definition of 'company' in section one, shall at all times be represented by an individual residing therein.".

(2) Subsection (1) shall be deemed to have come into operation on 23 February 2000.

. Section 104 of the Income Tax Act, 1962, is hereby amended by the substitution for the words following paragraph (d) of subsection (1) of the following words:

"shall be guilty of an offence and liable on conviction to a fine [not exceeding one thousand rand] or to imprisonment for a period not exceeding two years or to both such fine and such imprisonment.".

. (1) Section 106 of the Income Tax Act, 1962, is hereby amended by the substitution for subparagraph (i) of paragraph (d) of subsection (2) of the following subparagraph:

"(i) if left with some adult person apparently residing at or occupying or employed at the place appointed by the company under subsection (5) of section 101 or, in the case of any unit portfolio referred to in paragraph (e)(i) of the definition of 'company' in section 1, the public officer of which is the trustee referred to in the said subsection (5), by such trustee, or where no such place has been appointed by the company or trustee, as the case may be, if left with some adult person apparently residing at or occupying or employed at the last known office or place of business of the company or trustee, as the case may be, in the Republic; or".

(2) Subsection (1) shall be deemed to have come into operation on 23 February 2000.

. (1) Paragraph 1 of the Fourth Schedule to the Income Tax Act, 1962, is hereby amended —

1. by the addition to the definition of "employee" of the following paragraphs:

"(e) any personal service company; and

(f) any personal service trust;";

2. by the substitution for the definition of "labour broker" of the following definition:

"’labour broker’ means any person who conducts or carries on any business whereby such person for reward provides a client of such business with other persons [(other than any person who qualifies as a labour broker under this definition)] to render a service or perform work for such client, or procures such other persons for the client, for which services or work such other persons are remunerated by such person;";

3. by the insertion after the definition of "labour broker" of the following definitions:

"personal service company" means any company (other than a company which is a labour broker), where any service rendered on behalf of such company to a client of such company is rendered personally by any person who is a connected person in relation to such company, and¾

except where such company throughout the year of assessment, employs more than three full-time employees who are on a full-time basis engaged in the business of such company of rendering any such service, other than any employee who is a shareholder or member of the company or is a connected person in relation to such person.

"personal service trust" means any trust where any service rendered on behalf of such trust to a client of such trust is rendered personally by any person who is a connected person in relation to such trust, and¾

except where such trust throughout the year of assessment, employs more than three full-time employees who are on a full-time basis engaged in the business of such trust of rendering any such service, other than any employee who is a connected person relation to such person or such trust.".

(2)(a) Subsection (1)(a) shall come into operation on 1 August 2000.

(b) Subsection (1)(b) shall come into operation on 1 July 2000

(c) Subsections (1)(c) and (d) shall be deemed to have come into operation on 1 April 2000, and shall apply in respect of any year of assessment commencing on or after that date.

. (1) Paragraph 2 of the Fourth Schedule to the Income Tax Act, 1962, is hereby amended by the addition to item (a) of subparagraph (5) of the following proviso:

"Provided that the Commissioner shall not issue such certificate if―

(cc) such labour broker and any client of such labour broker has agreed that a specified employee of such labour broker will render any service to such client.".

(2) Subsection (1) shall come into operation on the date of promulgation and shall apply in respect of any certificate issued on or after that date.

. Paragraph 1 of the Seventh Schedule to the Income Tax Act, 1962, is hereby amended by the substitution for the definition of "official rate of interest" of the following definition:

"’official rate of interest’ means a rate of interest [of 16 per cent per annum] as the Minister of Finance may from time to time fix by notice in the Gazette.;".

. Paragraph 9 of the Seventh Schedule to the Income Tax Act, 1962, is hereby amended by the substitution for item (b) of subparagraph (4) of the following item:

"(b) in any other case, an amount calculated [at the rate of R100 per person per day for each day during which the accommodation was so occupied or] at the prevailing rate per day at which such accommodation [would] could normally be let to any person who is not an employee of the employer or of any associated institution in relation to the employer, [whichever rate is lower].".

. Paragraph 19 of the Seventh Schedule to the Income Tax Act, 1962, is hereby substituted by the following paragraph:

"Any person who makes or issues or causes to be made or issued or knowingly possesses or uses or causes to be used any certificate referred to in paragraph 17(1) which is false, shall be guilty of an offence and liable on conviction to a fine [not exceeding R400] or to imprisonment for a period not exceeding six months or to both such fine and such imprisonment.".

. Paragraph 20 of the Seventh Schedule to the Income Tax Act, 1962, is hereby amended —

1. by the deletion of item (a) of subparagraph (1) thereof;
2. by the substitution for item (e) of subparagraph (1) of the following item:

"(e) the provisions of paragraph 9(3)[(b)](a) so as to vary the amount and quantities specified therein;";

3. by the deletion of item (f) and (g) of subparagraph (1); and
4. by the substitution for item (i) of subparagraph (1) of the following item:

"(i) the provisions of paragraph 10(2)[(d)] so as to vary the amount specified therein;".

. (1) The following section is hereby inserted after section 47A of the Customs and Excise Act, 1964:

"Air passenger tax. —

47B. (1)(a) For the purposes of this section, unless the context otherwise indicates —

"accounting period" means any period prescribed for purposes of subsection (7);

"airport" means a customs and excise airport prescribed in item 200.04 of the Schedule to the rules;

"carriage" means carriage by air;

"document" includes information recorded in any form;

"agent" means an agent contemplated in subsection (5);

"chargeable aircraft" means an aircraft designed or adapted to carry any person in addition to the flight crew;

"chargeable passenger" means subject to the definition of "passenger" and subsection (3) every passenger on an aircraft departing from an airport in the Republic to a destination outside the Republic;

"flight" in relation to any person means the carriage of any person from any airport in the Republic on an aircraft to any destination outside the Republic and begins when the person first boards an aircraft on that journey and ends when the person disembarks from the aircraft at such destination whether or not the journey includes a domestic flight connection with another flight which carries the person to such destination;

"operator" in relation to any aircraft means the person having the management of the aircraft for the time being and includes any airline charterer or natural person who owns such aircraft or in whose name the aircraft is registered in terms of the regulations made under the Aviation Act, No. 74 of 1962 or hired;

"passenger" in relation to any aircraft means —

(a) Where the operator is an air transport undertaking, any person carried on the aircraft other than —

(i) a member of the flight crew;

(ii) a cabin attendant; or

(iii) a person not carried for reward who is an employee

of the aircraft operator and who satisfies such other requirements as may be prescribed by rule;

(b) In any other case, any person carried for reward;

"reward" in relation to the carriage of any person includes any form of consideration received or to be received;

"tax" means air passenger tax;

(2)(a) An air passenger tax shall be charged in accordance with this section on the carriage on a chargeable aircraft of any chargeable passenger.

(b) Air passenger tax shall be charged at the rate of R100,00 on the carriage of each chargeable passenger departing on a flight from an airport in the Republic and shall be paid for the benefit of the National Revenue Fund at the time prescribed by rule as contemplated in subsection (7).

(c) Subject to the provisions of this section and the rules, the tax —

(i) becomes due when the aircraft first takes off on the passenger’s flight;

(ii) shall be paid by the operator of the aircraft or the agent contemplated in subsection (7).

(d) Subject to the provisions of this section and except for the purposes of any customs union agreement concluded under section 51, such tax shall be deemed to be a duty leviable under this Act.

(3)(a) A child who —

(i) has not attained the age of two years; and

(ii) is not allocated a separate seat before boarding the aircraft,

is not a chargeable passenger.

(b) A passenger is not a chargeable passenger if carried―

(i) not for reward —

(aa) in pursuance of any requirement imposed under any law; or

(bb) for the purposes only of inspecting matters relating to the aircraft or the flight crew;

(ii) whether or not for reward, in pursuance of any international agreement, convention or obligation, subject to the approval of the Commissioner and such conditions he may impose in each case;

(c) Any passenger, who is in transit through the Republic and departs from the transit area of the airport on a flight without entering the Republic by passing through immigration is not a chargeable passenger.

(4)(a) The Commissioner shall keep a register of aircraft operators.

(b)(i) The operator of a chargeable aircraft used for the carriage of any chargeable passenger shall be liable to be registered under this section.

(ii) Application for such registration shall be in such form and manner and contain such information as may be prescribed by rule.

(c) Any person liable to be registered under this section ceases to be so liable if the Commissioner is, on good cause shown, satisfied —

(i) that such person no longer operates any chargeable aircraft; or

(ii) that no chargeable aircraft operated by such person will be used for the carriage of chargeable passengers.

(d) Any person not registered and who has not applied for registration and not given notice under the subsection shall, if he becomes liable to be registered at any time, give notice of that fact to the Commissioner and apply for registration in writing within 7 days of the time of becoming so liable.

(e) Every pilot of a chargeable aircraft shall produce for the purposes of section 7(6)(a) together with the report outwards, proof of such registration or a certificate from the Commissioner that the aircraft operator is not liable to register and a passenger manifest in such form and containing such particulars as may be prescribed by rule.

(5)(a) An aircraft operator who —

(i) is, or is liable to be registered; and

(ii) does not meet the requirements of paragraph (b),

is required to appoint an agent whose place of business is in the Republic as the South African representative of such operator.

(b) A person meets the requirements of this subsection if such person —

(i) has any business establishment or other fixed establishment in the Republic; or

(ii) is an individual and is usually resident in the Republic.

(c) The Commissioner may register any person appointed under this subsection by any aircraft operator to be the agent of such principal and if so registered such agent shall be entitled to act on behalf of the principal for the purposes of this Act.

(d) The Commissioner may by rule prescribe —

(i) the persons who may be appointed as agent;

(ii) the manner in which a person and the conditions on which a person is to be appointed as agent for an aircraft operator;

(iii) the conditions on which such agents are to be registered by the Commissioner;

(e) The provisions of sections 98 and 99(1) shall apply mutatis mutandis, respectively, to such aircraft operator and agent.

(6)(a) No —

9. (i) operator of an aircraft who is liable to be registered; or

(ii) agent appointed by any aircraft operator,

shall conduct any business under this section unless such person has furnished such security as the Commissioner may require.

(b) The Commissioner may at any time require that the form, nature or amount of such security be altered in such a manner as he may determined.

(7)(a) Aircraft operators who are registered or liable to be registered under this section shall —

(i) keep accounts in such form and manner as may be prescribed by rule; and

(ii) shall render tax accounts at such time and in such manner and for such periods as may be prescribed by rule.

(b)(i) Any aircraft operator or agent of such operator shall pay any tax due at such time and in such manner and at such place as may be prescribed by rule.

(ii) (aa) Any tax due and not accounted for and paid in accordance with the provisions of this subsection shall be paid, upon demand by the Commissioner.

(bb) If such tax is not paid within fourteen days after the demand for payment was made it shall be recoverable in terms of the provisions of this Act as if it were a duty payable under this Act.

(iii) Interest on any outstanding tax shall be payable as provided in section 105.

(iv) Any amounts of tax overpaid shall be refundable in the circumstances and on compliance with such conditions as may be prescribed by rule.

(9)(a) Any person who —

(i) is knowingly a party to the fraudulent evasion of tax or attempts to or assists any other person in taking steps with a view to such fraudulent evasion; and

(ii) any person who in connection with tax makes a statement he knows to be false or recklessly makes a statement that is false, or, with intent to deceive produces or makes use of a book or account return or other document that is false,

shall be guilty of an offence and liable on conviction to a fine not exceeding R40 000 or three times the value of the tax to which the offence relates, whichever is the greater or to imprisonment for a period not exceeding ten years or to both such fine and imprisonment and the aircraft in respect of which such fraudulent evasion took place or false statements were made shall be liable to forfeiture.".

(2) Subsection (1) shall come into operation on 1 November 2000, and shall apply to any carriage of a passenger on an aircraft, which begins on or after that date.

Section 49 of the Customs and Excise Act, 1964 is hereby amended by the insertion after subsection 5A of the following subsection:

"(5B) Notwithstanding the provisions of subsection (5), the Minister may include in any notice published under that subsection, the full text of any such agreement or protocol except any protocol or other part thereof, as the case may be, published under subsection 48(1A), and if so included, the whole agreement or protocol as the case may be, shall be enacted into law as part of this Act as contemplated in subsection (1)(a).".

(2) Subsection (1) shall be deemed to have come into operation on 24 November 1999.

. (1) Section 75 of the Customs and Excise Act, 1964, is hereby amended by the substitution for paragraph (b) of subsection (1) of the following paragraph:

"(b) Any imported goods described in Schedule No. 4 shall be admitted under rebate of any customs duty or fuel levy applicable in respect of such goods at the time of entry for home consumption thereof, to the extent stated in, and subject to compliance with the provisions of, the item of Schedule No. 4 in which such goods are specified.".

(2) Subsection (1) shall be deemed to have come into operation on…

. Section 76 of Customs and Excise Act, 1964 is hereby amended —

1. by the deletion of the word "or" at the end of paragraph (f);
2. by the addition of the word "or" at the end of paragraph (g); and
3. by the insertion in subsection (2) of the following paragraph after paragraph (g):

"(h) notwithstanding the provisions of section 49(9), duty having been paid on any goods at the general rate of duty specified in respect of any heading or subheading in Part 1 of Schedule No. 1 and proof is produced that the goods concerned qualify for a preferential rate of duty specified for such heading or subheading in the said Part 1 of the said Schedule No. 1.".

(2) Subsection (1) shall be deemed to have come into operation on 1 January 2000.

. Section 105 of the Customs and Excise Act, 1964, is hereby amended by the substitution for paragraph (b) of the following paragraph:

"(b) the interest so payable shall be paid at [the rate of 19 per cent per annum, or such other] a rate which the Minister of Finance may from time to time fix by notice in the Gazette;".

. (1) Schedule No. 1 to the Customs and Excise Act, 1964, is hereby amended as set out in Schedule 2 to this Act.

(2) Subject to the provisions of section 58(1) of the Customs and Excise Act, 1964, this section shall be deemed to have come into operation on 23 February 2000.

. (1) Every amendment or withdrawal of or insertion in Schedules Nos. 1 to 6, inclusive, to the Customs and Excise Act, 1964, made under section 48, 56 or 75(15) of that Act during the calendar year ending on 31 December 1999 shall not lapse by virtue of the provisions of section 48(6), 56(3) or 75(16) of that Act.

(2) The amendments of Part 5 of Schedule No. 1 to the customs and Excise Act, 1964, made under section 48 of that Act by Government Notice No. R.321 of 3 April 2000, shall not lapse by virtue of the provisions of section 48(6) of that Act.

. (1) Section 4 of the Stamp Duties Act, 1968, is hereby amended —

1. by the deletion of subparagraph (iv) of paragraph (b) of subsection (1);
2. by the substitution for subparagraph (i) of paragraph (f) of subsection (1) of the following subparagraph:

"(i) a [religious, charitable or educational institution of a public character] public benefit organisation which is exempt from tax in terms of section 10(1)[(f)](cN) of the Income Tax Act, 1962 (Act 58 of 1962), and any fund which is exempt from tax in terms of section 10(1)(fA) of the said Act which provides funds solely to such a public benefit organisation; or";

3. by the deletion of subparagraphs (ii) and (iii) of paragraph (f) of subsection (1); and
4. by the substitution of the words following subparagraph (iii) of paragraph (f) of subsection (1) of the following words:

"if the duty thereon would be legally payable and borne by such [institution, fund, company, society, trust or other association] public benefit organisation or fund, as the case may be;";

5. by the addition to subsection (1) of the following paragraph:

"(h) any instrument transferred by —

9. any public benefit organisation which is exempt from tax in terms of the provisions of section 10(1)(cN) of the Income Tax Act, 1962, to any other entity in order to comply with the provisions of the proviso to subsection (2) of section 30 of that Act; or

(ii) any fund contemplated in section 10(1)(fA) of the Income Tax Act, 1962, to any other entity in order to comply with the provisions of paragraph (b) of the first proviso to section 10(1)(fA) of that Act.".

(2)(a) Subsection (1)(a) shall come into operation on 1 January 2000.

(b) Subsection (1)(b), (c), (d) and (e) shall come into operation a date to be determined by the President by way of proclamation in the Gazette.

. Section 5 of the Stamp Duties Act, 1968, is hereby amended¾

1. by the substitution for the words preceding the proviso to subsection (1) of the following words:

"The payment of any duty or of any penalty incurred under section 9 shall, save as is otherwise specially provided in this Act, be denoted by means of adhesive revenue stamps for the amount of such duty or adhesive penalty stamps for the amount of such penalty [where the amount of such duty or penalty does not exceed an amount of R400], and such stamps shall be affixed to the instrument chargeable with the duty or penalty and be defaced as prescribed by this Act:"; and

2. by the deletion of subsection (1A).

. Section 27 of the Stamp Duties Act, 1968, is hereby amended —

1. by the substitution for the words following paragraph (k) of subsection (1) of the following words:

"or who causes or procures any of the acts mentioned in any of paragraphs (a) to (k), inclusive, to be done or knowingly aids, abets or assists any person in doing any such act, shall be guilty of an offence and liable on conviction to a fine [not exceeding R10 000] or to imprisonment for a period not exceeding two years or to both such fine and such imprisonment."; and

2. by the substitution for the words following paragraph (b) of subsection (2) of the following words:

"shall be guilty of an offence and liable on conviction to a fine [not exceeding R4 000] or to imprisonment for a period not exceeding six months or to both such fine and such imprisonment.".

. Section 28A of the Stamp Duties Act, 1968, is hereby amended by the substitution for the words following paragraph (c) of subsection (1) of the following words:

"shall be guilty of an offence and on conviction liable to a fine [not exceeding R4 000] or to imprisonment for a period not exceeding six months or to both such fine and such imprisonment.".

. Section 31C of the Stamp Duties Act, 1968, is hereby amended —

1. by the substitution for paragraph (b) of subsection (8) of the following paragraph:

"(b) have the same powers —

9. to enforce the attendance of witnesses and to compel them to give evidence or to produce evidential material; and

2. relating to contempt,

as are vested in a President of the Special Court contemplated in section 83 of the Income Tax Act, 1962; and";

(b) by the substitution for subsections (11), (12) and (13) of the following subsections:

"(11) Any person whose affairs are investigated in the course of an inquiry contemplated in this section, shall be entitled to be present [throughout] at the inquiry during such time as his affairs are investigated, unless on application by the person contemplated in subsection (1), the presiding officer directs otherwise on the ground that the presence of the person and his representative, or either of them, would be prejudicial to the effective conduct of the inquiry.

(12) Any person contemplated in subsection (9) has the right to [a representative of his choice] have a legal representative present during the time that he appears before the presiding officer.

(13) An inquiry contemplated in this section shall [not be public] be private and confidential and the presiding officer shall at any time on application [of] by the person whose affairs are investigated or any other person giving evidence or the person contemplated in subsection (1), exclude from such inquiry or require to withdraw therefrom, all or any persons whose attendance is not necessary for the inquiry.";

1. by the addition after subsection (14) of the following subsections:

"(15) Any person who has been required to appear before the presiding officer at the inquiry and who—

(b) having been sworn or having made an affirmation—

shall be guilty of an offence.

(17)(a) No person may refuse to answer any question on the grounds that it may incriminate him or her.

(b) No such incriminating evidence shall be admissible in any criminal proceedings against the person giving such evidence, other than in proceedings where that person stands trial on a charge relating to the administering or the giving of false evidence or the making of a false statement in connection with such questions and answers, or a failure to answer lawful questions fully and satisfactorily, or a charge in connection with a breach of the provisions of subsection (15).

(18) An inquiry in terms of this section shall proceed notwithstanding the fact that any civil or criminal proceedings are pending or contemplated against or involving any person identified in subsection (6)(c) or any witness or potential witness or any person whose affairs may be investigated in the course of that inquiry.".

. Item 15 of Schedule 1 to the Stamp Duties Act, 1968, is hereby amended —

1. by the deletion of paragraph (d) under the Exemptions from (1) and (2); and
2. by the deletion of paragraph (u) under the Exemptions from (3).

. Item 18 of Schedule 1 of the Stamp Duties Act, 1968, is hereby amended —