The SAIT Environmental Tax Technical Work Group’s submission proposes reforms to enhance the effectiveness and administrative efficiency of South Africa’s carbon tax system. It recommends introducing a Carbon Tax Recycling mechanism that would allow companies to reinvest future carbon tax payments into verified energy-transition projects, thereby accelerating decarbonisation, improving competitiveness, and maintaining the polluter-pays principle. The submission also highlights the heavy administrative burden caused by the annual paper-based licensing and registration renewal process required under the Customs and Excise Act. It argues that annual renewals serve no purpose where taxpayer details have not changed and contradict environmental objectives by requiring unnecessary printing and travel. Accordingly, it proposes removing the annual renewal requirement for carbon tax licensees whose particulars remain unchanged, reducing compliance costs for taxpayers and administrative load for SARS.
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