South Africa’s plan to invigorate its skills-starved economy through a “nomad visa” for remote workers has been delayed due to unresolved tax regulation issues.
The initiative, first announced by President Cyril Ramaphosa during his 2022 State of the Nation address, encountered setbacks when proposed changes to the visa policy failed to meet mandatory public consultation requirements.
Home Affairs Minister Leon Schreiber explained that the visa rollout is pending final adjustments to tax-related regulations.
“There is just a tax-related matter that needs to be addressed in the regulations,” Schreiber said. “Once that is done, the department will begin the rollout.”
The introduction of the nomad visa aims to address criticisms of South Africa’s complex work permit system, which has been identified as a significant barrier to economic growth.
The current system, often taking over a year to navigate, has been scrutinized by the presidency and major business organizations.
Despite the delay, there has been some progress. Since forming a coalition government and announcing a new cabinet on June 30, the backlog of over 300,000 residence permit applications has been reduced by half.
Under the initial proposal, foreign remote workers would have been allowed to reside in South Africa for up to six months without paying local taxes, provided they earn at least $56,669 annually.
However, the plan remains in limbo until a resolution on tax regulations is reached, leaving South Africa’s ambitions to attract global talent uncertain.