Having just prophesied (see "Exchange Control To Go?
") that Exchange Control is going to go, I note that in the most recent Guidelines issued by the Reserve Bank in early July reference has been made to how the Reserve Bank is going to deal with further Exchange Control ownings ups. The wording which I quote in full because of its brevity is as follows:
The Minister of Finance has recently approved the following guidelines, which should not be construed as an extension of the current amnesty provisions, in respect of individuals who voluntarily approach the Exchange Control Department of the South African Reserve Bank to regularise their exchange control affairs:
Applications received after 2004-02-29 until the finalisation of the amnesty process will carry a general levy of between 10% to 30%. Post the finalisation of the amnesty process the levy applicable will range from 20% to 40%, which is also the range applicable to individuals who have since 2003-02-28 contravened the Exchange Control Regulations. In all these instances the individual will have the choice to repatriate his/her foreign assets. The determination of the final levy is at the discretion of the Exchange Control Department of the South African Reserve Bank and will, inter alia, depend on whether the individual elects to retain the funds abroad or repatriate such funds.
Individuals who neither applied for amnesty nor approached the Exchange Control Department for assistance will face the full force of the law. In this regard, the Exchange Control Department is mandated to recover the full amount involved in the contravention and to report the matter to the South African Police Service for further investigation and prosecution.Clearly neither the Reserve Bank nor the Receiver are giving up on last minute inducements. Albeit that the Guidelines contains no like offer from the Receiver of Revenue, any information given to the Reserve Bank will in turn be passed on to the Receiver and self evidently the Receiver will adopt a harsher approach unless the taxpayer provides the Receiver with the information in question at the same time! It is interesting to note, however, that there are now two sets of levies applying namely before the finalisation of the Amnesty process and thereafter. The finalisation of the Amnesty process presumably refers to the fact that in terms of Section 27 of the Act, the Minister must terminate the existence of the Amnesty Unit by notice in the Gazette at the later of all applications having been approved or the appeals in respect of those applications which have not been approved having been finalised.
The Minister is also required to report to Parliament on the number of applicants and facilitators respectively who have applied for Amnesty; (b) the total market value of all foreign assets which have been disclosed
..; (c) the total amount of all levies payable
. I do not think termination of the Amnesty process will only occur once the Minister has made such a report but rather on the actual termination of the Amnesty Unit.
As my favourite crooner once sang Its now or never