South Africa plans to revise its exchange controls for companies and will delay tightening rules that govern cross-border interest taxation until 2013, Finance Minister Pravin Gordhan said on 24 August.
"The proposed amendments remove various tax hurdles that a multi-national company would face if it based its regional headquarters in South Africa. We are also revising exchange controls to support such initiatives," he said in parliament, without further explanation.
Gordhan added that South Africa's exemptions for cross-border interest were much wider than global practice, costing the country significant potential revenue.
The Treasury's budget in February hinted at changes on cross-border interest. It did not immediately respond to questions. Further details may come in October when it presents its Medium-Term Budget Policy statement.
Current laws exempt foreign investors based in South Africa from tax on interest received from their operations outside the country.
