Revenue Laws Amendment Bill: adoption

NCOP Finance

25 March 2024
Chairperson: Mr Y Carrim (ANC, KZN)
Share this page:

Meeting Summary


Report of the meeting to follow.

In this virtual meeting, the Committee convened to finalise the Revenue Laws Amendment Bill.


In this Bill, the government proposes implementing the “two-pot” retirement system to address the concerns related to lack of preservation before retirement and lack of access to retirement funds by households in financial distress. The “two-pot” system comprises a savings and retirement component for contributions made after 1 September 2024, while historical retirement benefits will be housed in a vested component. Individuals will have access to amounts in the savings component before retirement for times of financial distress, and amounts in the retirement component are preserved until retirement.

The Bill also proposes (1) to make provision for the inclusion of defined benefit funds in the “two-pot” retirement regime, (2) to calculate the contributions to the savings and retirement components, and (3) that legacy retirement annuity funds be excluded from the provisions of the “two-pot” retirement system. Under the regime, pension fund members can make intra-fund transfers at any time they wish, and these transfers will be treated as tax-free transfers.

The Committee adopted the Bill unanimously.

The Committee also approved the accompanying report.

Following input from the DA, the Committee added a recommendation to the report to encourage big businesses to participate in the public participation processes because it is in their interests to engage with parliamentary committees. Parliament ultimately decides on legislation, not the Executive.

Meeting report

Opening remarks

The Chairperson greeted everyone. He said the Committee convened today to process the Revenue Laws Amendment Bill [B39B-2023].

He noted that the Committee’s report on the Revenue Laws Amendment Bill had been thoroughly consulted with all parties, and it seems as though there is consensus. He suggested that the meeting commence with an informal discussion on the Committee’s report, then a formal consideration of the Bill, followed by a formal consideration of the Committee’s report.

Informal discussion: Committee’s report on the Revenue Laws Amendment Bill

The Chairperson invited Members to comment.

Mr D Ryder (DA, Gauteng) said that he had proposed a recommendation based on one of the observations. He believed that where the Committee made an observation, it would be appropriate to link it to a recommendation. He recommended that the Committee encourage big business to participate in the public participation processes because it would bring in expert input.

He recalled that during the processing of the Revenue Laws Amendment Bill, the Committees of both Houses were pushing for a very early implementation date of the two-pot system. However, big business indicated that other things needed to change first. He explained that big businesses, such as insurance companies or banks, employ economists at a substantial expense. It would be useful for the Committee to receive inputs from different perspectives. He believed big businesses had a much bigger role in public participation processes. He acknowledged that his recommendation was not enforceable. He suggested that the Committee could send out messages encouraging big business to engage with Parliament and to deepen the conversation about the impact of legislation once it is passed. He said he would be most grateful if the report included this recommendation.

Mr W Aucamp (DA, Northern Cape) said he fully supported Mr Ryder’s recommendation. He believed it would be very good to get big businesses from the banking industry or big finance companies to provide their input during public participation. Parliament would gain more input from a broader spectrum of companies.

The Chairperson said that big businesses play a very active role in Parliament. Although big businesses did not comment much on the Revenue Laws Amendment Bill, Business Unity South Africa (BUSA) submitted about 140 pages of comments on the Public Procurement Bill. Businesses are usually overwhelmingly represented through their own structures and various other aligned structures. He noted that the Association for Savings and Investment South Africa (ASISA) was present during the public participation process on the Revenue Laws Amendment Bill; ASISA were also given the opportunity to ensure that their comments were accurately reflected in the Committee’s report. He asked whether the recommendation was to suggest that big businesses should be encouraged to participate in general or if it was to suggest that big businesses should become more involved in bills such as the Revenue Laws Amendment Bill. He cautioned the Committee to be careful because the recommendation was setting a precedent, which would give rise to questions such as why the Committee was not mentioning other stakeholders who should also be encouraged to participate in the legislative processes.

He concurred that the recommendation was unenforceable. The Committee cannot recommend big businesses to participate; it can only encourage them. Although it would be ideal, it was not true that every observation must be linked to a recommendation, because that would mean that the Committee is clear about what the observation implies. Sometimes it is impossible to get consensus within or across political parties. Observations are meant to encourage an understanding of the issues that the stakeholders submitted or reflect how the majority of the Committee views the issues. He believed that there should be a balanced participation of stakeholders. He noted that he merely wanted to present some of the implications of Mr Ryder’s recommendation, but that his own view was not the view of the majority party.

Adv Frank Jenkins, Senior Parliamentary Legal Advisor, said that the Committee could call anybody to attend a committee meeting. If the Committee is unhappy with the quality of public submissions that it received, then the Committee could use the tools that it has. The Committee cannot bind the private sector to its recommendations, that is done through legislation.

The Chairperson thanked Adv Jenkins for pointing out that the Committee could always invite stakeholders to appear before it. He asked if any other Members wanted to comment on Mr Ryder’s recommendation.

Ms D Mahlangu (ANC, Mpumalanga) said she had nothing different to say. She agreed with the Chairperson's comments on public participation. She said that the Chairperson had correctly said that the Committee can invite stakeholders and interested persons to participate, but it cannot force them to do so.

The Chairperson told Mr Ryder that no one disagreed with his recommendation. He had engaged with businesses regularly throughout the last term, especially when he did not understand some of the issues. He suggested that the Committee could strengthen Mr Ryder's recommendation. For instance, it could be strengthened by saying, “while ultimate decisions on legislation lie with parliamentary committees, business can enhance the quality of a Bill through executive participation.”

Mr Ryder said he was happy with the Chairperson’s suggestion to strengthen the recommendation.

The Chairperson said that even Members within the ANC might be divided. The ANC is a big multi-class or multi-strata organisation. The ANC is not a narrow political party hung together by a clear set of ideological and policy proposals. He believed that some citizens felt that the Committee identified too much with big business while noting that the President is attacked by anybody and everybody for his propensity to do big business. Some citizens feel that the country is collapsing, and there should be more engagements with the private sector.

He reiterated that politics exists within the ANC, although it tries to be consensual. He was certain that the DA also had its own internal policy issues regarding issues such as welfare, etc. He asked Mr Ryder if the Committee could settle on strengthening his recommendation.

Mr Ryder replied that he would be happy with that.

The Chairperson thanked the Members for their cooperation. He asked if ASISA and the Congress of South African Trade Unions (COSATU) wanted to comment on the Committee’s report.

Mr Matthew Parks, Parliamentary Coordinator, COSATU, replied that COSATU had gone through the Committee’s report and was very happy. COSATU did not have a problem with encouraging businesses to participate. COSATU often engaged with businesses through the National Economic Development and Labour Council (NEDLEC) and bargaining councils.

The Chairperson noted that Ms Adri Messerschmidt, Senior Policy Advisor: Regulatory Affairs, ASISA, had also indicated in the chat box that ASISA was comfortable with the report.

Consideration of Revenue Laws Amendment Bill

The Chairperson informed the Committee that he had consulted with a National Treasury official prior to the meeting, who told him that the Revenue Laws Amendment Bill required no further technical amendments.

He read the page numbers of the Bill and invited Members to raise questions. There were no questions.

Ms M Mamaregane (ANC, Limpopo) moved to adopt the Bill. Ms L Moss (ANC, Western Cape) seconded this. There were no objections.

The Chairperson noted that the Bill had been passed unanimously.

Consideration of Committee’s Report on the Revenue Laws Amendment Bill

The Chairperson referred to a section in the report, which read, “Adherence to the agreed implementation date of 01 September 2024: This date means that the Committee should seek to process this Bill through the NCOP as soon as reasonably possible. The implementation deadline will have to be strictly adhered to, and all the necessary legislative and administrative processes need to be addressed in time. NT will need to work with the South African Revenue Service (SARS) and the pension fund administrators to ensure this. NT also needs to expedite regulations”. He further noted that ASISA had commented on this by saying, “NT has indicated that the provisions in the Pension Funds Amendment Bill for regulations to be published will be removed. These provisions are unnecessary given that regulations can in any event be published at any time, and that the Financial Sector Conduct Authority is empowered to publish conduct standards if required”. He invited an official from the National Treasury to comment on this.

Mr Chris Axelson, Acting Head: Tax and Financial Sector Policy, National Treasury, said that ASISA’s comment was correct.

The Chairperson asked Mr Axelson if the Committee should omit the sentence that says, “NT also needs to expedite regulations”.

Mr Axelson replied that it could be removed.

The Chairperson referred to the observation that Mr Ryder had recommended earlier. It read, “The Committee notes, with disappointment, that only three stakeholders made submissions on the 2023 RLAB. It notes, too, that big business engaged more with the Executive than with Parliament. It is in their interests to engage with parliamentary committees as it is Parliament that ultimately decides on legislation, not the Executive”. He suggested that this be strengthened by saying that the Committee urges big businesses to participate, as it will be in their and Parliament's interests. It must be written so the Committee is “not some sort of subordinate structure to either business or COSATU”. He asked if the Members agreed with this. There were no objections.

Ms Moss moved to adopt the report. Ms Mahlangu seconded this.

Read: ATC240325: Report of the Select Committee on Finance on the Revenue Laws Amendment Bill [B39B - 2023] (National Assembly- section 77), dated 25 March 2024

Closing remarks

The Chairperson informed the Committee that there would be an adjusted programme. He noted that the Committee still had to deal with the negotiating mandates on the Public Procurement Bill.

The Committee will meet tomorrow to receive a briefing from the National Treasury on the Pension Funds Amendment Bill.

The meeting was adjourned.

Download as PDF

You can download this page as a PDF using your browser's print functionality. Click on the "Print" button below and select the "PDF" option under destinations/printers.

See detailed instructions for your browser here.

Share this page: