Budget Speech time is rapidly approaching and taxpayers will be
looking to the Minister of Finance for details on how he plans to
fill the government coffers for the 2013 fiscal year.With the
National Development Plan top of mind, the roll-out of the National
Health Insurance pilot sites imminent and the proposed introduction
of a youth wage subsidy gaining momentum, the Minister is going to
have to find ways to improve tax collections.
As part of efforts to bolster tax revenues, the budget speech is
likely – in part – to reflect a continued focus on
regulating transactions that have the effect of eroding South
Africa's tax base.
Leveraged buy-out transactions have been high on the list of
transactions that have attracted scrutiny in the past few years.
These transactions are often characterised by significant levels of
gearing and accompanying interest deductions. The interest
deductions result in large assessed losses being racked up by
businesses that were in a
