Further to my enquiry 28 September 2018, we would appreciate your comment/advice regarding an email and Government Gazette document 40691/97 # 231, received from Dept Labour during October 2017.
Important:
This answer is based on tax law for the tax year ending 28 February 2020.
Answer:
For ease of reference we copied the notice below:
“Government Notice 231 in Government Gazette 40691 dated 17 March 2017. Commencement date: 1 April 2017.
Under Section 12(3)(a) of the Unemployment Insurance Act, 2001 (Act No. 63 of 2001) as amended, I, MILDRED NELISIWE OLIPHANT, Minister of Labour, hereby amend the scale of benefits referred to in Government Notice No. 588 which was published in Government Gazette No. 3550 dated 03 August 2012 from one hundred and seventy eight thousand four hundred and sixty four rand per annum (R178 464) to two hundred and twelve thousand five hundred and thirty nine rand per annum (R212 539) / seventeen thousand seven hundred and twelve rand per month (R17 712) / four thousand and eighty seven rand per week (R4 087) with effect from 01 April 2017.”
The amount, the R17 712, is also the amount used in the information you provided.
As we indicated in our first response, the remuneration threshold is dealt with under section 6 of the Unemployment Insurance Contributions Act, 2002 and the relevant notice in the Gazette. Section 6(2) of this Act reads as follows:
“Subsection (1) does not apply to so much of the remuneration paid or payable by an employer to an employee during any month as exceeds an amount determined from time to time by the Minister of Finance by notice in the Gazette, after consultation with the Minister of Labour and the Unemployment Insurance Commissioner.”
The Minister of Finance proposed in the 2015 National Budget a temporary reduction in contributions by employers and employees to the Unemployment Insurance Fund ("the UIF"), while keeping benefits unchanged. It is proposed that the remuneration threshold, against which the contributions are calculated, be reduced from the current monthly amount of R14 872 to RI 000.1 The reduction is proposed to take effect on 1 April 2015 and a revision thereof will be considered before 1 April 2016. If implemented, both employers and employees will be required to pay a maximum of R10 each per month.
It was stated there that currently; the maximum contribution stands at R148.72 each per month. Section 6(2) of the Unemployment Insurance Contributions Act, 2002, enables the Minister of Finance to adjust the remuneration threshold by notice in the Gazette, after consultation with the Minister of Labour and the UIF Commissioner.
It was also said, in this notice, that “should the temporary reduction in UIF contributions be implemented in 2015/16 fiscal year, the Minister of Finance will reconsider the contribution remuneration threshold before the next 2016/17 fiscal year. As before, any change will take the long-term sustainability of the fund into consideration.” We have indicated that we are not aware of any notice in a Gazette that increased this amount. It is not R178 464 or R17 712 per month.