'Tax hikes expected as government tries to plug R50bn hole' - Economist


SA expats will face government committee over plans to tax earnings made abroad

The South African Expats Tax Petition Group will submit oral presentations to the government on August 29th, to fight against the ill-conceived plans to tax SA workers for the money they make abroad

'Tax hikes expected as government tries to plug R50bn hole' - Economist


  • The repeal of the 183/60 exemption on foreign income earned section of the tax laws (Article 10) has caused a stir to hard-working South Africans abroad.
  • The proposal have left families and workers with an impossible decision to make: Abandon the SA economy completely, or come home and compete for jobs in an already stagnant economy.
  • However, the SA Expats Tax Petition Group have got the chance to present their arguments to a government Standing Committee on the 29th August: Here are the major points they hope will stop the repeal of the tax exemptions

South African Expats Tax Petition Group

Lets set some records straight: We are currently a group with 13693 members, rapidly growing, and not 8000. In addition, we have a petition which has been formally submitted to the government at 11681 signatures.

How we are fighting the repeal of tax exemptions for workers abroad

We have by 18th August deadline made 1358 submissions to the national treasury including two submittals made by Barry Pretorius as a group submission with the petition attached and a technical submission made on our EPG groups behalf by the highly esteemed Jerry Botha.

These have also been submitted to the standing committee on finances of the parliament with a formal request to do oral presentations on the 29 August 2017, which has been approved by the secretary of the standing committee.

We Refer to this link for further information on this submittal.

Read: SA Expats rally against law that plans to tax workers for income made abroad 

Who does the tax group represent?

This group do not represent only the South Africans working abroad. This is made of wage earners abroad and in SA, family members, friends and colleagues whom have come out in support of those earning their living abroad.

It is also many South Africans still residing and working in South Africa whom wish to come and work abroad and are concerned about the impact of the repeal of section 10 on them being able to work abroad.

It is a multi-racial, multi-cultural group brought together by the unifying factor of both personal fear and concern for individual futures and for the health of the economy and next generations following in our footsteps.

Tax Compliance

The low numbers of annual tax returns, submitted by South Africans abroad, is also reflective of tax consultants advising their clients to do nil or ‘zero value tax returns’ and not to do tax returns as they have been based abroad for so many years.

A large compliment of the group members have been abroad in excess of 5-10 years and cannot in any ways under current laws be deemed as tax residents in any case. There seems even within these organizations a history of misunderstanding the tax laws and causing confusion amongst the workers abroad.

Members based abroad are average working-class citizens and the prevailing concerns are not due to having illicit funds or assets that SARS might lay claim to but that they will not be able to pay the taxes if deemed tax liable by the repeal of article 10.

South Africans abroad are facing panic

Many South Africans, now working abroad, appear to be left with two options: Cut financial ties with South Africa completely and abandon its economy or return to an SA job market that is already under pressure to provide jobs for all. Both these choices are not good for South Africa.

Large numbers of these are initiating emigration procedures, draining the South African potential resource pool of millions of man-hours of experience and skill sets.

In addition, many UAE “permanent residency based” South Africans have started obtaining TDC’s -Tax domicile certificates which with DTA’s, contest that they are not tax residents of SA or ordinary residents.

A report from the General Directorate of Residency and Foreigners Affairs specifying the number of days the resident has stayed in the UAE comes included with this tax domicile/residency certificate. These certificates cost AED 2400 per annum (R 8640.00), money that again is being drained away from South Africa.

Financial consequences for South Africans abroad

Those residing in the Middle Eastern countries availed themselves of extremely high bank loans with very attractive interest rates. This, in addition to long term 10-15 year off shore investments based upon an income exempted for SA taxes, place them in dire financial positions.

Withdrawal from these investments due, to now having to pay taxes, would cost huge penalties and loss of funds resulting in many returning to SA without those funds and becoming a burden on the state.

Failure of payments on loans in these countries, even bouncing of cheques, is met with laws strictly applied resulting in incarceration in jail and your passport/ability to leave the country withheld.

If the relevant government bodies fail to take note of our members’ concerns on tax levies for expats related to housing, schooling and utilities, it would be very short sighted indeed.


  • Greater clarity is required from both Treasury and the South African Receiver of Revenue.


  • Serious consideration should be given to the feasibility and real aims of repealing article 10
  • The claim by treasury that this repeal is based upon “to equalize the fact that government employees abroad are taxed” is NOT an acceptable reason for this repeal. All other of 194 of 196 countries does tax their diplomats stationed abroad and using a form of 183/60 day rule not their expats.


  • Even if article 10 is then repealed, a viable alternative exemption system should be proposed and at a minimum deduction for expats on housing, schooling, transportation, excessive co-payments on medical expenses should be considered.


  • If they are considered residents of SA they must, in turn, be considered as conducting business abroad in earning that income.