Cosatu 'disappointed' by tax incentive bill

The trade union federation is concerned the bill will encourage employers to fire older workers.

Cosatu says it's disappointed that government signed the Employment Tax Incentive Act into law on 18 December. Picture:Sapa.

JOHANNESBURG - The Congress of South African Trade Unions (Cosatu) says it is disappointed government has signed the Employment Tax Incentive Act into law.

President Jacob Zuma signed the bill into law on Wednesday.

Originally called the youth wage subsidy, treasury says the incentive will encourage employers to hire young job seekers.

But trade unions are vigorously opposed to the law.

Cosatu President Sidumo Dlamini says they have opposed the bill from the very beginning because it will encourage employers to fire older, more experienced workers.

"We have been saying to government it's a dangerous bill. We are disappointed but we will still fight on."

The legislation will take effect from 1 January.

Meanwhile, the South African Revenue Service (Sars) Adrian Lackay says information about the incentive will be made available from next month.

"People can contact Sars and will be guided as to what they need to do on their monthly payroll submissions. Basically, if you employ young people within designated age groups you will qualify for tax benefits."