Businesses have voiced their frustration towards the South African Revenue Service (SARS) for taking too long to process payments under the government's Employment Tax Incentive (ETI).
The government launched the ETI in 2014, as a financial incentive to encourage companies to hire young job seekers.
Since the programme is in its eighth year, some companies have claimed that SARS has failed due to its audits that drag on.
The incentive scheme gave out more than R2 billion to local businesses that hired young people aged between 18 and 29 during its initial phase.
Although the ETI programme has been praised as a positive move despite youth unemployment still remaining at an all-time high, current delays in processing claims for the ETI may reverse some of the advancements made over the previous eight years.
ETI Max, a tax expert, assists affected businesses in claiming employment tax incentives. The company claims SARS has not explained the delays affecting many of its clients. The company added that they are appealing to SARS to provide more validation information if necessary.
I'm sure they've identified certain risks. Maybe that's why they're not releasing them to tell us what those risks are. We will deal with those risks on a client-by-client basis so that those amounts can be released.
Some businesses finance their operations with ETI returns. The incentive has spurred firms in a variety of industries, such as cleaning, security, and retail, to hire more young people. However, the program's existing delays and payments are starting to turn away potential participants.
Working with young people has the power to improve or add to your company's bottom line massively, according to Business Secretary Ed Balls. "It encourages us to get the right people on board to employ younger skills to train up the youth and pass it on," he said.
Some hold the view that SARS' concerns about how ETI is handled in South Africa may have some merit. Over the past six months, ETI has become incredibly complicated. Some people think that significant delays may be caused by changes in the incentive programme's management.
Several small businesses continue to suffer the consequences as they wait for the payments.
