Speech on Tax Administration Laws Amendment Bill and Taxation Laws Amendment Bill
Speech by ACDP MP, Steve Swart

Issued by the ACDP Parliamentary Media Office

Educate employees about hefty tax obligations with two-pot system

Jan 13, 2026

House Chair, the ACDP believes in following the scriptural injunction: “Render unto Caesar what is due unto Caesar, and unto God what is due unto God.” These tax bills are of a highly technical nature and largely seek to enhance compliance.

We commend SARS for the higher than expected revenue collection: an additional R19.7 billion over and above what was projected, driven by improved compliance and enforcement measures which includes a focus on the illicit economy.

An additional R7.5 billion was allocated to SARS to boost its capabilities and this is expected to yield significant returns. Yet, sadly, over the medium term, revenue projections are expected to be weaker due to lower nominal GDP growth and downward revisions to corporate income and personal income tax rates. That is clearly concerning and higher economic growth is required.

Certain amendments contained in these bills refer to technical refinements in the two-pot retirement systems. Many employees drawing from the two-pot system were shocked at the amount of tax they were required to pay. Employees need to be better educated that this will be a direct result of the early drawing from their retirement funds and will reduce the amount available for retirement.

On that and other indirect tax issues contained in the bill, the ACDP notes concerns about the impact of proposed changes on independent schools, and we welcome the fact of the deferral arrangements for such schools.

As far as the Tax Administration Bill is concerned, the most extensive submissions related to refinements to what is known as the Understatement Penalty Framework. Certain stakeholders were concerned about the bonafide inadvertent error concept, believing that the penalties should only apply where conduct offends the public interest.

The National Treasurer and SARS responded that understatement penalties have always been behavioural-based and that no penalty can be imposed unless the taxpayer’s conduct falls within the behaviours listed within the table. This the ACDP appreciates.

We also appreciate the fact that penalties are subject to objection and appeal and that reliance on professional advice—as many taxpayers do—continues to be recognised as a factor indicating reasonable behaviour on behalf of the taxpayer.

Chairperson, the ACDP appreciates this explanation and the technical amendments and as Kingdom-builders, we will support these bills.

Thank you, honourable Minister, and everything of the best.

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