Tax incentive bill necessary - ANC

Johannesburg - The ANC parliamentary caucus will support the employment tax incentive bill because it is a necessary intervention, ANC Chief Whip Stone Sizani said on Thursday.

"The bill is one of the necessary and progressive interventions in the battle against the unacceptable rates of unemployment in our country, particularly among young people," he said in a statement.

"The bill will indeed arm young first time employees with much-needed job experience and improve their chances of future employment."

The bill, introduced by Finance Minister Pravin Gordhan in the National Assembly on Thursday afternoon, provides for a subsidy aimed at encouraging employers, through tax incentives, to take on young people aged from 18 to 29.

The African National Congress caucus met on Thursday morning to "considered a number of reports on important bills and other matters currently before Parliament", Sizani said.

The caucus was confident that the parliamentary process on the bill would produce a quality product.

"Those who have concerns about this bill are therefore urged to participate in the parliamentary consultation process so that its quality can be enhanced.

"We are hopeful that the bill will be implemented from January 2014," he said.

Both the Federation of Unions of SA (Fedusa) and the Congress of SA Trade Unions (Cosatu) have rejected the bill, citing a lack of consultation at the National Economic Development and Labour Council (Nedlac).

Introducing the bill, Gordhan warned that South Africa had "some of the highest rates of unemployment" in the world.

"The incidence of unemployment is highest among young people. This means [they] are denied the opportunity to gain skills and experience that will enable them to build future careers."

About 94% of unemployed young people did not have further or tertiary education.

"These are alarming indicators," Gordhan told MPs.