South Africa’s work visa reform plans slowed by tax woes

(Bloomberg) — South Africa’s plan to attract more professionals to its labor-scarce economy by introducing so-called nomadic visas for remote workers has been slowed by the need to change tax rules.

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The setback comes after an initial delay when changes to the visa system had to be temporarily withdrawn because mandatory public consultation procedures were not followed. President Cyril Ramaphosa announced his intention to introduce the remote work visa in his 2022 State of the Nation Address.

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“There is only the tax issue that needs to be addressed in the legislation,” Leon Schreiber, the country’s interior minister, said in response to questions. “Once that is done, the department will start implementing it.”

South Africa’s complicated work permit system, which means it can take more than a year to receive a work permit, has been identified as a hindrance to economic growth by both the presidential authorities and the country’s major business organisations.

However, since the new cabinet was announced on 30 June following the formation of the coalition government, the backlog of applications for all types of residence permits, which numbered more than 300,000, has been halved.

The Ministry of Home Affairs initially proposed allowing people employed and paid by companies elsewhere to stay in the country for up to six months a year without paying tax, provided they earn at least 1 million rand ($56,490) a year.

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