SA’s new Tax Incentive: A Lifeline for preserving Endangered Species

13 November 2023

Link: New tax incentive might be just what’s needed to save SA’s threatened species (dailymaverick.co.za)

Dear Rik Rhino Community,

We hope this message finds you well, and we are thrilled to connect with our esteemed customers who share our passion for conservation and wildlife. At Rik Rhino, we believe in keeping you updated on the impactful strides we are making in the world of conservation, and we have some exciting news to share.

Executive Summary

• South Africa’s Department of Forestry, Fisheries, and the Environment has introduced the country’s first tax incentive for threatened species, allowing individuals and entities involved in conservation efforts to deduct related expenses from their taxable income.
• The incentive, set at R1.5 million per year, is expected to alleviate the financial burden of conservation efforts, particularly for private landowners.
• The initiative also contributes to South Africa’s commitment to the Kunming-Montreal Global Biodiversity Framework, aiming to conserve at least 30% of the world’s lands, freshwater, and oceans by 2030.

Introduction

South Africa has introduced a tax incentive to protect endangered species, including iconic animals like rhinos and lions. This initiative, under Section 37C(1) in the Income Tax Act, aims to safeguard at-risk animals and plants, including rhinos, lions, vultures, cycads, and other vulnerable faunal and floral species. Ordinary South Africans can deduct all their conservation expenses from their taxable income by signing a Biodiversity Management Agreement (BMA) with the Minister of the Environment, Barbara Creecy. 1

1 New tax break for a very select few in South Africa

2 Daily maverick. 2023. New tax incentive might be just what’s needed to save SA’s threatened species

The initial BMAs, categorized as Candidate Other Effective Area-Based Conservation Measures (OECMs), are currently being implemented by landowners in the Limpopo Province. This implementation grants them access to the deduction, marking a tangible step toward achieving the dual impact of conservation and finance. Candice Steven, CEO and Chairperson of the Sustainable Finance Coalition, believes this tax incentive not only provides a financial solution for conservation but also creates Candidate OECMs, demonstrating its potential to significantly influence both conservation efforts and financial landscape.2

Procedure for Accessing the Deduction

To access the deduction, eligible individuals must follow these steps:

1. Sign a BMA with DFFE for a minimum period of five years.
2. Commit to prescribed conservation and maintenance actions, including alien-clearing, fodder provision, ranger salaries, security, veterinary expenses, and member levies contributing to conservation activities.
3. Qualify for deductions if they are not conducting commercial operations on the land subject to the BMA, effectively reducing their payable taxes.

This tax incentive stands as a significant step toward bridging the conservation finance gap, ultimately benefiting both individuals and the environment.

Conclusion

South Africa’s pioneering tax incentive for endangered species conservation exemplifies a proactive approach to address the pressing issue of biodiversity loss. By intertwining financial incentives with conservation efforts, the nation is taking a significant stride toward ensuring the sustained protection of its unique and threatened ecosystems. This initiative not only showcases the potential of public-private collaboration but also sets a noteworthy precedent for other nations grappling with similar conservation challenges.

At Rik Rhino, we believe that together, we can make a difference. By choosing us, you’re not just making a purchase; you’re investing in the future of our planet.

We encourage you to explore these tax incentives and join us in making a lasting impact on conservation.

Thank you for being a valued member of the Rik Rhino family.