SPECIAL ECONOMIC ZONE BILL PASSED INTO ACT
SENATORS passed the Special Economic Zone Bill 2017 into an Act, with reservations.
The Bill, which was brought to Senate by Minister of Commerce, Industry and Trade Jabulani Mabuza, was passed by senators after a lengthy debate.
The senators, during the debate, each said much as the country needed foreign investors, the 20-year-tax holiday was still too much and some even said they were scared the country was going back to the times when foreign investors were given a five-year tax holiday as they could leave on the fourth year.
The senators wanted to know how government would make sure that the investors would not leave just before the 20 years elapsed. Senator Themba Ginindza, who appeared very worried when making his submissions, wanted to know if there would be a commitment fee or a penalty in place for investors who would leave just before the 20-year tax free period elapsed.
Ginindza said government had to put an instrument in place to protect herself in the event an investor left. “What happens when an investor decides on the year just before the 20 years elapses that he is no longer interested in investing the country? Is there a commitment fee that they will pay then forfeit if they decide to just leave or a penalty fee?” he asked the minister.
Senator Moi Moi Masilela wondered why the ministers who had been in politics for a longtime had not properly advised Minister Mabuza.
Masilela said the country had gone through something similar before and now it was left with white elephants all over with huge factory shells for supposed foreign investors who would leave on the year their tax free period elapsed. “Why didn’t the seasoned ministers correctly advise you?” he wondered. “Your very ministry built factory shells that are now empty. I have heard everything you are saying now and it was said by the minister who built factory shells, which are now unoccupied,” he said.
Prince Kusa, making his submission, said government had a responsibility to create jobs for people but he was not convinced that this was the rightful way to go about it.
“Government must create jobs for people but I am not convinced that the Special Economic Zones are an answer to that,” he said. He said there was still need for the ministry to fine tune the Bill before it could be passed by Senate.