Title page for ETD etd-03192012-104952

Document Type Master's Dissertation
Author Du Plessis, Marique Marthine
Email mmdp247@yahoo.com
URN etd-03192012-104952
Document Title Tax incentives - effective stimulation for growth and investment in South Africa?
Degree MCom
Department Taxation
Advisor Name Title
Mr G Meiring Supervisor
  • foreign direct investments
  • FDIs
  • economy
  • direkte buitelandse beleggings
  • stimulate
  • tax incentives
  • tax regimes
  • belastingstelsel
  • belastingaansporing
  • stimuleer
  • ekonomie
Date 2012-04-16
Availability restricted
Tax incentives are often used as a tool by governments across the globe to either promote the desirability of a certain country as a business destination, or to stimulate specific sectors within the economy. Tax incentives are especially used by developing countries such as South Africa, and are often used to not only promote local trade and industry, but also to attract foreign investment.

Although prior research has been performed on tax incentives, very little research has been done on how tax incentives influence the South African economy and, more specifically, the effect tax incentives has on foreign direct investment.

The traditional understanding is that tax incentives, particularly concerning foreign direct investment, are not only open to dispute in theory, but also undesirable in practice. Tax incentives are bad in theory because they distort and warp investment decisions, and they are considered bad in practice because they are often ineffective, inefficient and prone to abuse and corruption.

The aim of this study is to evaluate the use of tax incentives as a means of stimulating capital investment. It will begin by reviewing the advantages and disadvantages connected with incentives schemes and various policy goals connected with investment spending aimed at growth in the economy. A review of available literature related to tax incentives used in other countries such as Australia, China and Singapore will follow to determine if South Africa could feasibly adopt these tax regimes. Finally, specific tax incentives introduced for the 2010 FIFA World Cup held in South Africa will be examined.

AFRIKAANS : Belasting-aansporings is ‘n hulpmiddel wat dikwels deur regerings węreldwyd gebruik word om sekere lande as aantreklike besigheidsbestemming te bemark of om spesifieke sektore binne die ekonomie te stimuleer. Belastingaansporings word veral deur ontwikkelende lande soos Suid-Afrika gebruik.

Alhoewel vorige navorsing uitgevoer is ten opsigte van belastingaansporings, is daar baie beperkte navorsing beskikbaar oor die invloed wat belastingaansporings het op die Suid Afrikaanse ekonomie, en meer spesifiek die effek wat belastingaansporings het op buitelandse direkte beleggings.

Die tradisionele verstandhouding is dat belastingaansporings, veral met betrekking tot buitelandse direkte beleggings nie net oop is vir dispuut in teorie nie, maar ook ongewens is in die partyk. Belastingaansporings word beskou as ongewens in die partyk omdat dit dikwels oneffektief en ondoeltreffend is en geneig is tot misbruik en korrupsie.

Die doel van hierdie studie is om die gebruik van belastingaansporings as ‘n middel van stimulasie vir kapitale beleggings te evalueer. Dit begin met die hersiening van voordele en nadele wat verband hou met aansporingskemas en verskeie doelwitte wat verband hou met investering en gemik is op die groei van die ekonomie. Dit word gevolg deur ‘n bespreking oor beskikbare literatuur met betrekking tot belastingaansporings wat deur lande soos Australië, China en Singapoer gebruik word om te bepaal of Suid Afrika hierdie belastingstelsels moontlik kan implementeer. Ten slotte word die spesifieke belastingsaansporingskemas ondersoek wat bekendgestel was vir die 2010 FIFA Węreldbeker.

Copyright 2011, University of Pretoria. All rights reserved. The copyright in this work vests in the University of Pretoria. No part of this work may be reproduced or transmitted in any form or by any means, without the prior written permission of the University of Pretoria.

Please cite as follows:

Du Plessis, MM 2011, Tax incentives - effective stimulation for growth and investment in South Africa?, MCom dissertation, University of Pretoria, Pretoria, viewed yymmdd < http://upetd.up.ac.za/thesis/available/etd-03192012-104952 / >


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