New 'tweaked' Carbon Tax Bill draft released

A second draft of the Carbon Tax Bill has pushed out the actual imposition of the new tax and significantly reduced the tax burden in real terms. According to a Fin24 report, the new draft was released in mid-December and mostly retains the design of the first version, published in 2015 – but comes with several technical tweaks. The date that SA starts the so-called second phase of carbon taxation has been moved from 2020 to 2022 to reflect the two years that have passed between the drafts. The new Bill still sets the tax at R120 per ton of carbon dioxide – and still provides allowances which, in effect, put the tax at R48 a ton at most, and at R6 a ton at least. A combination of inflation and revisions has resulted in a carbon tax that will be far lower than initially planned when a carbon tax policy was first published in 2013. Izak Swart, a director at Deloitte, said the new Bill incorporated necessary technical improvements, including more comprehensive lists of ‘emission factors’ – the multiplier that allows a company to calculate its emissions for the purpose of the tax. A national system of carbon reporting comes into operation this year, with large emitters being required to submit estimates of their 2017 emissions to the Department of Environmental Affairs by the end of March. This process will probably contribute to a host of new comment on the Carbon Tax Bill, said Swart. ‘Everybody reporting their emissions will likely be paying the carbon tax. We will now see what the actual emissions are – and what the tax will be.’

Full Fin24 report