Abstract
M.Com. (Tax)
The study is an examination of the special VAT provisions relating to
small businesses in terms of the Value Added Tax Act no 89 of 1991.
The special provisions relating to retailers as applied in the United
Kingdom and other countries are also examined.
The study identifies problems that a small business encounters as a
result of the VAT requirements set out in the Value Added Tax Act as
well as problems arising from the specific circumstances in which a
small business finds itself.
The special VAT provisions in South Africa are compared with the
provisions in the United Kingdom and other countries. Certain recommendations
are made by the author regarding these special provisions.
It is important that these special provisions are stated
simply and clearly to provide a VAT system with few exceptions to the
basic rules. However, the Act must cater for the small business and
provide choices that will suit the circumstances of the small business.
Certain countries provide special schemes for retailers. The different
schemes are identified and the study determines whether these
schemes are appropriate in the South African context. The study comes
to the conclusion that it is not necessary to have special schemes restricted
only to retailers. A common treatment for small businesses
and retailers must be the aim of the legislators.
The Act must be formulated in such a manner that the circumstances of
small businesses and retailers and the accompanying problems
encountered by them are taken into account in the legislation.