Dear Standing Committee on Finance,

To my Comment on the Fiscal Framework and Revenue Proposals' that will be tabled together with the 2025/2026 Budget on Wednesday , 19 February 2025

The money Bill Amendment Procedure and Related Matters Act, Act no 9 0f 2009 Defines the Fiscal Framework as follows :

The Frame Work for a Specific Financial Year that gives Effect to the Economic Policy and includes -

EStimates of all Revenues ,Budgetary and extra Budgetary Specified Separately expected to be raised during that financial year.

estimates of borrowing for that financial year,and the estimates of interest and debt servicing charges and indication of the necessary for appropriate response to emergencies or other temporary needs and other factors based on similar objective criteria.

However on the 25 November 2024 the SARB issued Exchange Control Circular 13/2024 which changes this dispensation this was preceded by an earlier announcement by the Minister of Finance in the 2024Budget Review that the rules would be amended.

The reason for the change was indicated as being a continuous effort by the National treasury to reduce red tape, coupled with the fact that the transfer pricing rules in current tax legislation already filter risks relating to improper transfers between related parties.

As is the case with payment of Royalities and fees by residents to unrelated non residents authorized dealers will be authorized to approve such payment requests in relation to related parties and will retain an oversight role in considering such requests.

Without going into too much detail, person who have entered into relevant related party transaction and where the aggregate of the relevant amounts exceeds or is reasonably expected to exceed R100 million for the year, are required to retain a host of specified records, books of account and documents in relation to transfer pricing

A person who have entered into relevant related party transaction, but who fall below the R100 million threshold are still required to keep such records books of account or document that enable them to ensure and SARS to be satisfied, that the transactions were conducted at arm's length

Close code to the Article below
The effect is essentially that, when a resident applies to an authorized dealer to make payment of royalties or fees to a related non resident that resident will inter alia have to provide written confirmation that it has complied with its transfer pricing obligations as prescribed in terms of section 29 of the TAA (Tax Administration Act) Act 28 of 2011
My Submission indicate the question where is the Budget to be table will it indicate the Clear Fiscal that illustrate the Administration Revenue Tat Obligation that meet the financial model??/