The impact of tax incentives to stimulate investment in South Africa

Estian Calitz, Sally Wallace and Le Roux Burrows

No 19/2013, Working Papers from Stellenbosch University, Department of Economics

Abstract: The purpose of this paper is, very generally, to provide a framework and potential methodology of analysis of tax incentives in one country — South Africa. As incentives are often specific and targeted, the precise methods needed to analyse the effectiveness of incentives may well differ among types of incentives. However, by positing a framework for evaluation based on basic economic principles, we believe that transparency, accountability and rigorous evaluation of individual incentives or regarding the choice of incentives may be enhanced. A classification of different tax incentives is provided, with reference to their acceptability in the economic literature and with an indication of their occurrence in South Africa. The cost of tax incentives to manufacturing in South Africa is estimated by sector of economic activity, indicating a sizeable drain on the national budget, and a multiplier analysis of current tax incentives is undertaken.

Keywords: South African tax incentives; Investment incentives; tax policy; tax incentives; tax expenditure (search for similar items in EconPapers)
JEL-codes: H2 H25 H3 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-afr and nep-pbe
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Citations: View citations in EconPapers (4)

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https://www.ekon.sun.ac.za/wpapers/2013/wp192013/wp-19-2013.pdf First version, 2013 (application/pdf)

Related works:
Working Paper: The Impact of Tax Incentives to Stimulate Investment in South Africa (2013)
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