Finweek English Edition - - TECHNOLOGY -

Just over a year ago, the new div­i­dend with­hold­ing tax (DWT) was in­tro­duced, and while it hurt in­vestors as the rate was 15% vs the 10% rate for the pre­vi­ous sec­ondary tax on com­pa­nies (STC) it’s help­ing cor­po­rate re­sults look bet­ter. Un­der the old STC regime, a com­pany paid tax on the div­i­dends but now the tax is taken from the in­di­vid­ual, in other words the tax the com­pany used to pay is no longer an ex­pense in its re­sults and hence boosts prof­its. If we look at re­cent Vo­da­com re­sults its ef­fec­tive tax rate dropped from 36% for the March 2012 year-end to 28.3% in the 2013 yearend. Of course, this may not all be due to

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