Presentation to RFA Convention

1
Provincial Fuel Levies How such legislation come
to be passed The process, mechanisms, timings,
consultations, etc.
Presentation to RFA Convention May 2007
2
Parliament and the provincial legislatures must
facilitate public involvement in their
legislative and other processes
3
Constitutional framework for provincial taxes
Section 228 228. Provincial taxes (1) A
provincial legislature may impose (a) taxes,
levies and duties other than income tax,
value-added tax, general sales tax, rates on
property or customs duties and (b) flat-rate
surcharges on any tax, levy or duty that is
imposed by national legislation, other than on
corporate income tax, value-added tax, rates on
property or custom duties.
4
Constitutional framework for provincial taxes
(cont.)
Internal limitation in section 228(2)
(2) The power of a provincial legislature to
impose taxes, levies, duties and surcharges
(a) may not be exercised in a way that
materially and unreasonably prejudices national
economic policies, economic activities across
provincial boundaries, or the national mobility
of goods, services, capital or labour and (b)
must be regulated in terms of an Act of
Parliament, which may be enacted only after any
recommendations of the Financial and Fiscal
Commission have been considered.
5
Provincial Tax Regulation Process Act, 2001 (Act
No. 53 of 2001)
Section 3 provides for the procedure relating to
the introduction of provincial tax.

• MEC for Finance in the province must submit
  particulars of the proposed provincial tax to the
  Minister, including consultation process.
• The Minister may consult any other organ of state
  or interested persons on the submission
  contemplated in subsection.
• The Minister must consult with the members of the
  Budget Council and
• refer a copy of the submission to the Financial
  and Fiscal Commission for comment.
• If the Minister is, on reasonable grounds,
  satisfied that the proposed provincial tax will
  not be in breach of section 228(2)(a) of the
  Constitution, the Minister must notify the
  province concerned in writing and by not later
  than 90 days after the notification or such other
  later date agreed with the members of the
  Council, introduce a Bill in Parliament to
  regulate the proposed provincial tax as required
  by section 228(2)(b) of the Constitution.

6
Provincial Tax Regulation Process Act, 2001
(cont.)
If the Minister has reservations about the
constitutionality of the proposed provincial tax,
the Minister must notify the MEC for Finance
concerned in writing of those reservations and
refer the proposed provincial tax back for its
reconsideration and submit a report on the
matter to the Budget Council and both Houses of
Parliament. If, after reconsideration by the MEC
for Finance concerned, the proposed provincial
tax fully accommodates the Ministers
reservations, the Minister must proceed with the
proposed provincial tax. If it does not, the
Minister must either proceed despite the
reservation or refer it to the Constitutional
Court for a decision on its constitutionality. If
the Constitutional Court decides that the
proposed provincial tax is constitutional, the
Minister must proceed with the proposal.
7
Passage of a Bill in Parliament
Constitution and the standing rules of Parliament

• Constitution provides framework for passage of
  Bills
• Approval by Cabinet, submission of draft to
  Parliament
• Prior notice in Government Gazette, including
  invitation to submit written representations
• Tabling, classification, refer to committee
• Consultation and reporting
• House passes and refer to second House
• Refer to President for assent

8
Legislative process for passing a Bill regulating
a provincial fuel levy

• Policy Provincial Tax Regulation Process Act
• Published in the Government Gazette invitation
  to comment
• Introduction Minister of Finance in NA
• Table and Classification Section 76(1)
• Refer to portfolio committee
• Public participation in committee
• Consideration and report to NA
• Passed and refer to NCOP
• Refer for briefing of Select Committee
• Referred to provincial legislatures for
  consideration
• Provincial committees public participation
• Negotiating mandate and final mandate to
  delegates in NCOP
• Report to NCOP
• NCOP considers and passes in accordance with
  voting mandates
• Submitted to President for assent

9
The legislative process for passing a provincial
Bill imposing a fuel levy

• Approval by Executive Council
• Not published in Provincial Gazette
• Introduced in provincial legislature by MEC for
  Finance on the date when the relevant provinces
  annual budget is introduced
• Money Bill imposes a levy
• Tabled and referred to committee
• Public participation process
• Report
• Approval by House
• Submitted to Premier for assent

10
Consultation and timing
Consultation required for valid process to pass
legislation

• Notices appear in
• Government Gazette, Provincial Gazette
• Web Pages of Parliament and provincial
  legislatures
• Government department Web Pages
• http//www.info.gov.za
• Timing
• Sooner the better
• Policy stage i.e. process in terms of Provincial
  Tax Regulation Process Act
• Consideration by Minister of Finance
• Committees of Parliament
• Committees of provincial legislatures
• Date of introduction of provincial budgets

11
Conclusion
Process in the Western Cape started in 2004 and
e.t.a. 2008!
No surprises
Thanks to my host, Road Freight Association who
also has details of opportunities relating to
public participation on their Web Page. Thank you
to Parliament for allowing my participation today
in line with its vision to be build a peoples
Parliament who is responsive to the needs of the
people and driven by the ideal of realising a
better quality of life for all the people of
South Africa.