Mastercard, Facebook Messenger to provide technology to small businesses in Africa

Mastercard will use Facebook Messenger to provide technology to small businesses in Africa and Asia to drive affordable acceptance of electronic and mobile payments.

At the recent Mobile World Congress, Mastercard announced that  access to digital payments will help these businesses expand to new markets, and unlock financial services and products that enables them to grow their livelihoods.

This Messenger experience will launch in Nigeria, where Mastercard will pilot a new Masterpass QR bot to help business owners’ move beyond cash transactions to accepting QR payments. Ecobank and Zenith Bank will support this inaugural program. The pilot in Nigeria is the beginning of a larger plan by the two companies to include more businesses into the digital economy.

According to research done by The Fletcher School and Mastercard Center for Inclusive Growth, of the $301 billion of funds flow from consumers to businesses in Nigeria, 98 percent is still based on cash.

“Every business owner is looking for ways to increase sales and draw new customers into their stores. By offering QR-based digital payments, smaller retailers can achieve these goals and create greater customer stickiness with little to no investment beyond the phone they already have,” said Jorn Lambert, Executive Vice President, Digital Channels and Regions, Mastercard. “Masterpass QR opens up new commerce channels for these merchants and enables them to create auditable transaction records. These advances open doors to other financial tools and products such as loans to drive added business growth.”

To get started, businesses can send a request to the bot to enable QR payments, receive approval from the bank, set up an account and start accepting digital payments in a fast, simple and secure manner. Once the account set up process is complete, business owners can print and display the QR code in their stores or save the code on their phones. Customers can pay by either scanning the code from their smartphone or by entering the merchant ID associated with the QR code into their feature phone.

“Brands and developers around the world are turning to messaging to connect with the 1.3 billion people who use Messenger each month,” said Kahina Van Dyke, Director of Payments and Financial Services Partnerships at Facebook. “We are pleased that Mastercard is developing a service on the Messenger Platform to help small merchants use messaging to manage their business and connect with their customers.”

Launched in 2016, Masterpass QR provides people with any type of mobile phone the ability to safely accept and make in-person purchases without cash or a plastic card. It provides greater choice in payments and complements Mastercard’s investment in contactless payments to provide merchants of all sizes – from international chains to individual shop owners and street vendors – a fast, secure and inexpensive way to accept payments.


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No further extension on the VAT claw back relief


Where a property developer constructed residential units for sale and these units are temporarily let out as a result of the adverse economic conditions the developer had to declare the output vat on a deemed supply of such units. This imposition of VAT on the deemed supply is based on the open market value of the property when the property was first let out. This resulted in unreasonably high negative cash flow consequences for property developers.

Relief offered by SARS

In 2012 the VAT Act was amended to include special relief in order to alleviate such unreasonable cash flow consequences, but this relief was only applicable for 36 months, commencing on or after 10 January 2012 and expiring on 1 January 2015. Further relief was then provided for a further 3 years to 1 January 2018.

Consequences for property developers

It should be noted that the 36 month rule is applicable to each unit. Therefore if a unit was let out from 1 January 2015 the vat claw back will apply on 1 January 2018. Property developers needs to consider ceasing the rental of these units to ensure that they do not fall foul of this provision. If any lease was entered into during the January 2015 period, and the unit is still being let out the developer will be liable to account for a deemed output VAT in his 2018/01 return (which if done monthly will be due at the end of February 2018).

Article written by Henico Schalekamp – Partner at PKF Octagon and published on

An Entrepreneurial Approach To Learning

The learning journey to a CA(SA) is clear. Training contracts have abundant learning opportunities and professional environments provide role-based learning opportunities. Entrepreneurial learning is self-driven and determined on immediate skill requirements to sustain business

As the professional journey evolves, the ‘formal’ learning opportunities become fewer and a ‘self-driven’ learning approach is imperative. Self-driven learning is work-environment and context dependent and plays a pivotal role in learning effectiveness.

Emotional intelligence (EQ) was singled out as being an explicit skill by the WEF, but in my view, many of the priority skills are principally grounded in EQ and EQ is pervasive to all learning.

Professionals learn differently, in the fast-paced and digitised business context.  Taking charge of your learning in this evolved world requires a refreshed outlook on ‘how’ and ‘what’ learning is crafted. The bygone era of the formal training course/workshop has changed.

Modern learning tenets (the ‘how’ of learning) therefore requires differing approaches.  These include: flexible and informal learning; continuous and autonomous learning; relevant and relatable content; instant and intelligent content and delivery media; and community driven and co-created learning, culminating in ‘right and bite-sized, brief and beautiful’ learning.

The ‘what’ of learning is driven by the work environment of the professional. Role-based employees traditionally pick from a menu of learning options available and through discussion with a performance manager, select learning events and conclude a learning plan. For an entrepreneur, this luxury is non-existent. An entrepreneur will find learning opportunities, based on critical needs, just in time.

Professionals’ ability to develop their EQ supersedes technical ability, and now needs to focus on creating a bespoke ‘learning matrix’ in line with their development aspirations. A learning matrix is a multidimensional individual and organisational co-created learning journey that is future-oriented to 2020 skills and will be used to support future careers and immediate needs.

The learning matrix should include: social consciousness and ethical pervasiveness; personal brand development; cultural integration and adaptation; business ecosystem navigation and systems theory understanding; leadership capability; and relationship and network rejuvenation. These areas will ensure relevancy as professionals as we move forward. The learning matrix should be fluid and flexible to your learning needs through the year, as the underlying context changes.

How can we create magic for our own learning agility and propel ourselves into the workplace of the future, beyond formal CPD? What will your learning matrix for 2018 look like?


As a professional in 2018, have you considered your own development? In January 2016, the World Economic Forum (WEF) published a roadmap of the 10 skills needed to thrive in the Fourth Industrial Revolution by the year 2020. In order of priority, these skills are complex problem-solving; critical thinking; creativity; people management; coordinating with others; emotional intelligence; judgement and decision-making; service orientation; negotiation; and cognitive flexibility.

Taking ownership for your continued development without a structured professional environment will be critical to your success and growth trajectory this year and beyond.


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Get Your CPD From R250 Per Month

CPD SA Accounting Academy

CPD Subscription 2018
The convenient and affordable way to keep your technical knowledge up to date

Why CPD?
Make sure that your CPD hours are taken care of in 2017 by subscribing to our highly cost-effective annual subscription package. This year you have even more flexibility as we are including 3 different package options according to your specific role and responsibilities. But if none of these packages is appropriate we are also offering the option to ‘build your own’ package of eight seminars that are most appropriate for you. All packages also include monthly webinars (accounting and/or tax related topics, depending on which option you choose).

You will be able to view the recordings of all seminars and webinars from our online platform, so that you can watch them at your own convenience. This facility is available to both individuals

What do I get as CPD Subscriber?

  • Access to a selected number of face-to-face seminars and webinars
  • 12 months’ unlimited access to all event, webinar and conference recordings
  • Online profile to manage all your CPD events
  • Automated management of CPD points and CPD certificates
  • Topics that focus on both compliance and the performance of your accounting firm
  • Personal Indemnity insurance option at a reduced rate

Can I join the CPD subscription package after the start of the year?

Yes, you can. If you join partway during the year, you will receive all the recordings in the current month that you signed up in. Should you wish to claim CPD hours for past events you will need to purchase these individually. Kindly note that your CPD package is subject to change to keep updated with current and relevant accounting and tax topics as you continue with your CPD Subscription.

When do I get access to my CPD?

Once you have signed up you will receive access to your personal profile. All the CPD events (webinars/seminars) that happened during the month you signed up in will be automatically allocated to your profile. You will have instant access to your current CPD events and can start claiming your CPD hours.


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Income tax: This is what you’ll pay

No rate hikes, but no inflationary adjustment for top four income brackets.

National Treasury will raise almost R7 billion from the personal income tax system through lower-than-inflation increases to tax rebates and brackets, effectively collecting taxes by stealth.

However, it has acknowledged that further hikes in personal income tax rates could be counterproductive and has kept rates unchanged.

Against the background of the introduction of a VAT hike of one percentage point to 15% on April 1, many taxpayers will see their disposable income come under pressure in the coming tax year.

The bottom three personal income tax brackets (for lower- and middle-income earners) and the primary, secondary and tertiary rebates will be partially adjusted for inflation through a 3.1% increase, while the top four brackets will remain unchanged from March 1.

The table below sets out the changes.

Tax Tables















South Africa’s personal income tax burden has slowly but surely increased from 8.3% of GDP in 2010/11 to 9.8% in 2017/18. In an effort to stabilise public finances and to enhance the progressive nature of the income tax system, government introduced a super tax bracket of 45% for individuals earning more than R1.5 million per annum in 2017. This was after personal income tax rates were increased by one percentage point in most cases in 2016.

“An additional personal income tax rate increase in 2018/19 would have greater negative consequences for growth and investment than a VAT increase. Moreover, significant shortfalls from this tax in 2017/18 suggest that further increases might not yield the revenue required to stabilise the public finances,” Treasury said in its budget review.

According to an analysis by PwC, the effect of the changes to the personal income tax rates will have the following effect at the various taxable income levels for taxpayers under 65:

Taxable Income 2018/2019 Tax Due Change from 2017/2018 % Change


R100,000 R3,933 -R432 -9.9%
R200,000 R22,265 -R910 -3.9%
R500,000 R113,807 -R2,017 -1.7%
R1,000,000 R312,973 -R2,017 -0.6%
R1,500,000 R517,973 -R2,017 -0.4%
R2,000,000 R742,973 -R2,017 -0.3%

The table below highlights the relatively small tax base and the skewed nature of income distribution in South Africa.
















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VAT increased to 15%

Government has proposed a one percentage point increase in the value-added tax (VAT) rate to 15%.

The increase was widely anticipated in tax circles as it is arguably the most effective way of raising significant amounts of additional revenue. National Treasury expects the hike, which will take effect on April 1 2018, to raise the lion’s share (R22.9 billion) of the R36 billion in additional taxes it hopes to collect in 2018/19 to stabilise the country’s fiscal situation.

“We have not adjusted VAT since 1993, and it is low compared to some of our peers. We therefore decided that increasing VAT was unavoidable if we are to maintain the integrity of our public finances,” finance minister Malusi Gigaba announced during his budget speech on Wednesday.

South Africa’s VAT system includes 19 basic foodstuffs – including samp, maize meal and rice – that are zero-rated. To limit the impact of the hike on poor individuals, this system will remain in place. Vulnerable households will also be compensated through an above average increase in social grants.

National Treasury said an additional personal income tax rate increase would have had greater negative consequences for growth and investment than a VAT hike.

“Moreover, significant shortfalls from this tax in 2017/18 suggest that further increases might not yield the revenue required to stabilise the public finances.”

Although the economic growth outlook has improved, growth remains elusive and GDP is only expected to expand by 1.5% in 2018, compared to Treasury’s earlier projection of 1.1%.

The VAT hike announcement will likely face significant push back from unions. Cosatu on Monday said it would not support any attempt by government to balance budget shortfalls and deficits upon the backs of struggling workers.

“Cosatu expects government not to throw the working and middle classes under the bus with VAT and income tax hikes… Workers are not the ones who have looted Eskom, SAA and the state.

“Government must remember workers are voters and they are tired.”

The union’s comments suggest that it may want to use the national election of 2019 as a bargaining chip to oppose a VAT hike.

Although Treasury did consider the introduction of a tiered VAT system, it said the VAT system was “not the best instrument for achieving redistributive goals”.

It said it was cognisant that personal income taxes have been raised in recent years and that it was not convinced that further hikes would result in substantial additional revenue.

“VAT is an efficient, certain source of revenue provided that its design is kept simple. Increasing the VAT rate by one percentage point is estimated to have the least detrimental effects on economic growth and employment over the medium term. The zero-rating of basic food items mitigates the effect of the increase on poor households.”

Treasury said the introduction of a tiered VAT system would require further enforcement, more resources at the South African Revenue Service (Sars) and could lead to legal uncertainty.

According to National Treasury, the wealthiest 30% of households contribute 85% of VAT revenue.

Lesley O’Connell, PwC VAT partner, says the VAT rate hike will result in additional costs for consumers as they will now have to pay an additional VAT on any purchases of goods or services from VAT vendors.

“This will have a major impact on households’ already tight budget. The implementation of the VAT increase for certain business will also be complex, and the implementation date of April 1 does not leave much time to allow businesses to effect the necessary system changes and enhancements.”

“This is the correct approach as we see further reliance on indirect taxes. This raises large amounts of revenue with relatively small increases in rates due to its broad base and economic efficiency. The effect that there is no amended list of zero rated foodstuffs is positive as it maintains the integrity and efficiency of the South African VAT system.”


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Budget 2018: 10 things you need to know

1. VAT increased from 14% to 15%

Government will raise the lion’s share of the R36 billion in additional taxes in 2018/19 through a one percentage point hike in the VAT rate. This is expected to contribute roughly R23 billion to the fiscus.

To limit the impact on poor households, the current zero-rating on basic foodstuffs such as maize meal, brown bread and rice will remain in place.

Vulnerable households will also be compensated through an above average increase in social grants, while some relief will be provided for lower-income individuals through an increase in the bottom three personal income tax brackets and the rebates, finance minister Malusi Gigaba said during his budget speech on Wednesday.

The increase will take effect on April 1 2018.

2. No inflation adjustment for four wealthiest income tax brackets

Government will raise almost R7 billion through lower-than-inflation increases to personal income tax brackets and rebates.

High-income earners will bear the brunt of these increases – while the bottom three personal income tax brackets as well as the primary, secondary and tertiary rebates will be partially adjusted for inflation through a 3.1% increase, the top four brackets will remain unchanged.

3. No wealth tax, but…

While there has been much speculation about the introduction of a wealth tax – potentially a land tax or annual net wealth tax – no explicit announcement was made in this regard.

However, Gigaba announced an increase in the ad-valorem excise duty rate on luxury goods from 7% to 9%, effective April 1 2018.

According to the budget review, these duties apply to “goods that are consumed mainly by wealthier households (such as cosmetics, electronics and golf balls)”.

Estate duty will also increase from 20% to 25% for estates of R30 million or more. This will take effect on March 1 2018.

4. No change to capital gains or dividend taxes

The dividends tax rate remains unchanged at 20% while the maximum effective capital gains tax rate for individuals stays at 18%.

5. Higher fuel levies

The general fuel levy will increase by 22 cents per litre while the Road Accident Fund levy will rise by 30 cents per litre. This will take effect on April 4.

6. Medical tax credit remains in place, but…

Medical tax credits have not been abolished, but will only increase from R303 to R310 per month for the first two beneficiaries (2.3%), and from R204 to R209 per month (2.5%) for the remaining beneficiaries.

“Over the next three years, below-inflation increases in medical tax credits will help government to fund the rollout of national health insurance,” the budget review stated.

Government also indicated that it was concerned that certain taxpayers might be “excessively benefiting from this rebate, specifically in instances where multiple taxpayers contribute toward the medical scheme or expenses of another person (for example, adult children jointly contributing to their elderly mother’s medical scheme). Where taxpayers carry a share of the medical scheme, contribution or medical cost, it is proposed that the medical tax credit should also be apportioned between the various contributors”.

7. Smokers and drinkers pay more

Excise duties on tobacco products will increase by 8.5%, and those on alcohol between 6% and 10%.

8. Economic growth outlook improves, but remains lacklustre

National Treasury revised its GDP growth projection for 2017 from 0.7% to 1%. It anticipates growth of 1.5% in 2018, compared to 1.1% in the Medium-Term Budget Policy Statement.

“While this is a good start, there are immediate policy interventions that we need to make to ensure that we create the right environment for investment, growth and employment,” Gigaba said.

9. Turnaround plan for state-owned companies (SOCs)

Government plans to introduce a reform programme for SOCs, which will consider their role in economic development. Entities like Eskom and SAA have been a huge burden on government coffers amid allegations of mismanagement and corruption.

“Some [SOCs] will require restructuring with equity investment. In the coming year, government may be required to provide financial support to several SOCs which could be done through a combination of disposing of non-core assets, strategic equity partners, or direct capital injections,” Gigaba said.

10. Roughly R57 billion allocated to free tertiary education over medium term

“Government will phase in fee-free higher education and training to students from poor and working-class families,” Gigaba said.

According to Treasury, all new first-year students with a family income below R350 000 per annum at universities and TVET colleges in the 2018 academic year will be funded for the full cost of study. This will be rolled out in subsequent years until all years of study are covered. Returning NSFAS students at university will have their loans for 2018 onwards converted to a bursary.


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