Phumzile facing R160 000 'bill'
2006-01-11 22:49
Pretoria - Deputy president Phumzile Mlambo-Ngcuka might have to fork out thousands for her family's holiday in Abu Dhabi in the United Arab Emirates.
Auditor Rudi van Zyl said this after the presidency acknowledged that the holiday flight in an air force VIP plane, was unofficial.
Van Zyl said that, in terms of the Income Tax Act,
it was a taxable fringe benefit.
Van Zyl said section 8 of the Income Tax Act provided that government officials' travel allowances were exempt from tax - provided that it was undertaken for official purposes.
"As soon as travel becomes unofficial, but the employer still pays for it, the seventh schedule of the Act stipulates that it is no longer exempt from tax.
"This schedule also stipulates that the employer must recover in the same month (as the travel) the employee's tax (PAYE) from the public servant concerned, and pay it to the Receiver.
"Based on the deputy president's income, this tax amounts to 40% of the total expense, which - according to what's been learnt - would
be about R400 000 in this case.
"So, the tax portion would be about R160 000."
Presidency spokesperson Murphy Morobe wouldn't comment in an interview with 702 Talk Radio when asked whether the holiday trip was considered one of Mlambo-Ngcuka's taxable perks.
He said, however, that there was nothing untoward in providing a VIP plane for the deputy president and her family.
He said this kind of concession was nothing unusual in the present or the previous dispensation in South Africa.
"The same benefits applied to former presidents FW de Klerk and PW Botha."