In line with announcements made by National Treasury in the 2020 Budget Review in February, the 2020 Draft Taxation Laws Amendment Bill (DTLAB) proposes amendments to the Income Tax Act (ITA) with the aim of limiting the entitlement to the favourable mining capital expenditure (capex) allowance to mining right holders. The proposed amendments could have “far-reaching and unintended consequences in its current form”, says tax advisory firm Renmere. The DTLAB was published for comment on July 31, and the proposed amendment states that the mining capex allowance should only be available to holders of a mining right as defined in Section 1 of the Mineral and Petroleum Resources Development Act (MPRDA), in respect of the mine where those mining operations are carried out.
