The government’s 1.1 billion rand gift to taxis was going to force them to formalize. Now, not so much.

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  • Applications are now open for Covid-19 relief payments, of R5,000 each, for online taxi operators and drivers.
  • The long-delayed program is expected to cost a total of R1.135 billion.
  • This money was to be used as leverage to force the taxi industry to formalize its operations.
  • This part of the plan is history – mostly.
  • For more stories, go to www.BusinessInsider.co.za.

Minibus taxi operators, taxi drivers and taxi drivers can now apply for payments of R5,000 each, as part of a ‘gratis’ taxi relief fund worth R1.135 billion rand, linked to Covid-19 restrictions on their operations.

It means the final death of a plan to use this long-allocated amount to force the formalization of the industry, forcing operators to set up businesses that must comply with labor laws – mainly.

One aspect of this plan has remained quietly in place, not in the rules but in the implementation of the program: a requirement for beneficiaries to have company registration and commercial banking documents, if they want to see the silver.

Transport Minister Fikile Mbalula announced the scheme was open to applications this week, 17 months after Parliament approved the allocation – when the Transport Ministry had to cut R4.6 billion from roads and railways to meet the special budgetary needs of Covid-19.

Since then, taxi operators have blocked major roads in protest at the amount of relief funding, demanding four times the amount allocated, and have threatened a nationwide strike, with support from the likes of the EFF.

The amount of money available remained the same, but taxi operators scored what appeared to be a significant victory when Mbalula canceled payment-related formalization plans.

In March last year, Mbalula decreed that beneficiaries should commit to a timetable for establishing formal businesses around their taxi operations.

The “relief scheme provides an opportunity for the formalization of the taxi industry,” the rules around payment said, with the promise that such formalization would enable future subsidies, the kind taxi associations have tirelessly campaigned for. military.

Taxi companies should make payments to the Unemployment Insurance Fund (UIF) and make their Skills Development Levy (SDL) payments, and comply with labor laws.

Taxi operators ‘will be required to transfer their operating licenses to commercial entities within seven years’, according to the rules, and still-funded minibus taxis were to be transferred from private owners to companies within five years. year.

In December, new rules removed all these requirements, no longer making any reference to formalization. Instead, taxi operators were only required to prove that they were citizens or permanent residents, had valid operating licenses, and were registered for income tax.

These are also the only demands Mbalula has highlighted this week.

The implementation of the apps, however, suggests that those without the formal attributes of a business may struggle to get paid their R5,000 – regardless of the changed rules.

The documents required to enroll in the Taxi Aid Scheme include a business registration certificate and a bank confirmation of a business bank account, with no payments being made to third party accounts.

(Compiled by Phillip de Wet)

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The post The government’s 1.1 billion rand gift to taxis was going to force them to formalize. Now, not so much. appeared first on The Bharat Express News.

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