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 There have been calls recently in South Africa for increased tax incentives for software development. This is obviously comming from people that do not have the benefit of an international community like we do. The support that we get from the international Open Source Community is amazing.
“South Africa already has the best IT
tax investment incentives in the World.” This is the opinion of
Philip Copeman, Project leader of the TurboCASH Accounting project.
Copeman was responding to the call by Johan Rupert and Vinny Lingham
of the Silicon Cape initiative for a tax-free zone. “It is not a
change of tax legislation that we require, but a change of attitude”,
said Copeman.
“Section
11(D) of the Act makes for a provision of 150% write off on
software development expenditure and gives a 50% write off on
capital investment. This is on a par with the UK, Australia and New
Zealand and ahead of most other countries. This legislation was
specifically written to encourage stimulation in the computer
software industry. It is not the legislation, but the will of the
participants that is lacking.”
“It has become part of our African
culture to ignore the efforts of locally produced software products
and to pass up the massive benefits of Open Source alternatives. We
choose instead to spend Billions annually on software licenses that
we have paid many times over. By promoting the products of foreign
owned companies in our schools, universities and corporations, we
prepare a generation of IT slaves. We have become a Nation of
Installers. “
“The TurboCASH Project is a project
that was originated in the Cape. We now have over 100 000 users in
communities in over 80 countries and 25 languages, supported by
thousands of consultants. In South Africa alone we have over 30 000
users and this saves South Africa over R 20 Million per year in
import replacement. From a South African viewpoint, what is
disturbing is that the intellectual momentum of the TurboCASH Project
is being pulled offshore. This is not through exchange control or
regulation, but through the willingness of foreign communities to
participate in the Open Source process. TurboCASH contributions from
Holland, Australia, New Zealand and the USA now exceed our South
African contributions and these countries offer far less than the tax
incentives offered to South Africans.”
“Our lack of input in the Open Source
process is not limited to Accounting. In total, Africa contributes
less than 2% to the Open Source Code base (lead by the USA and
Germany). Projects like the TurboCASH Project are scarce in South
Africa. This is unfortunate because while it is great to use Open
Source Software, the multiplier effect of actually developing
software is massive. The tax incentives are all there, it is the
players that are missing.”
Copeman also disagrees with Lingham and
Rupert about the restrictions on the ability of South Africans to
bill in foreign currencies. “The world is a global village and The
Internet has made it even smaller. It is not difficult to effect
foreign billings as typically transactions have reduced to micro
payments on the Internet. The problem is getting South African Banks
to establish their credibility in the offshore markets. In the
TurboCASH project, we often get payments rejected because foreign
credit card agents see an African server and outright reject the
authorization. This however is not a legislation issue. It is not the
regulation that makes African vendors appear as 411 scammers, it is
our own industry that has not built up our own credibility.
“The problems is not collecting the
cash, the problem is coming up with something that foreigners want to
pay for. This will only happen if we build our local industry. Before
you make your next software service purchase, ask if you are paying a
licence to an offshore desk job and a small install fee locally, or
are you actually paying for the improvement of our Code Base.”
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