Picture: THINKSTOCK
Picture: THINKSTOCK

PRESIDENT Jacob Zuma has ignored the pleas of the Congress of South African Trade Unions (Cosatu) not to sign a tax bill into law that will require the compulsory annuitisation of two-thirds of provident fund savings on retirement.

The federation said on Wednesday that it was "deeply incensed and disappointed" to learn that the Taxation Laws Amendment Act had been signed into law by the president and that the annuitisation provision would take effect from March 1.

It has warned that a "massive campaign" would be rolled out to get the measure scrapped.

"This is an outrageous and blatant act of provocation by the African National Congress (ANC)-led government that will have dire and lasting consequences on the relationship between government and the workers," Cosatu national spokesman Sizwe Pamla said. "It is an offence against all working people, who have their deferred wages to look forward to after retirement."

"We will spare no effort to stop this tyranny; because no government has a right to unilaterally decide for workers, how and when to spend their retirement savings."

Cosatu said Mr Zuma, in promulgating the act, had poisoned the relations between the ANC-led government and the workers, weakened the alliance and complicated the campaigning for the upcoming local government elections because workers would find it hard to vote against their interests.

"This issue will be at the top of the list of priorities to be discussed by the upcoming central executive committee (CEC) meeting of the federation next month," Mr Pamla said.