One of the major tax announcements from last week's Budget Speech that will affect businesses was the fact that we can expect the introduction of carbon tax in 2015.
The Business Day's BD Live
website says the introduction of carbon tax
for businesses is ironic as South Africa's biggest carbon emitter (80%) is the state-owned power monopoly, Eskom.
But it's definitely a step in the right direction.
Especially as world powers like the US and even China are now considering introducing a similar environmental protection tax
or carbon tax
, says Radio Free Asia
And many countries already have a 'carbon tax' policy in place.
How will the carbon tax affect your business?
Once the deductions are added, the carbon tax
will work out to 3.6c per kilowatt-hour of electricity, says the Mail & Guardian Online
Not so bad if your carbon emissions are low.
But if your company is a heavy polluter, you can take action now.
Because the tax price proposed is R120 per tonne of carbon dioxide emissions, and companies that don't become more sustainable will be punished with tax penalties!
Here's how you can act today to lower the carbon tax you'll pay when it's implemented through tax benefits
Apart from the obvious – reducing your carbon emissions or at least offsetting them by planting trees – you can also invest in external green projects to reduce your carbon tax liabilities.
There is also space for a carbon-trading scheme, where you'll be able to offset 5% to 10% of your company's carbon emissions by buying credits.
And in order to ensure the carbon tax does not harm the competitive advantage of local companies, an extra 10% deduction will be also available for what treasury calls 'trade exposure'.
So doing just a little at a time will quickly add up and possibly cancel out the amount of carbon tax you'll be liable for – but you'll have to start today.
Luckily there are tax benefits
to making sure your business lowers its carbon emissions
– do so now and you'll be ahead of the track, with hardly any impact on your bottom line.
For more tax breaks
to slash your tax
bill, get your hands on 30 Business Boosting Tax Breaks here
. This Booklet gives you 30 different tax breaks
you can implement today to save your business thousands of rands!
It covers everything from building allowances, to wear and tear. You'll never need to hunt out the tax
loopholes again - just keep this handy book on your shelf. And enjoy the savings!