Tag: tax evasion

When it comes to non-compliance, the South African Revenue Service (SARS) takes no prisoners, and has the full backing of the presidency, in its drive to stop tax evasion and other fraudulent activities related to the fiscus, with President Cyril Ramaphosa praising the revenue authority’s efforts in tackling tax dodgers and those benefitting from criminal proceeds.

The question of 'Selective Prosecution' has been asked since 2007 when the South African Revenue Service (SARS) started using lifestyle audits on private individuals. The selection basis, was the means of the individual, in contrast to their standard of living, and was conducted on individuals where there was a suspicion of criminal activity.

As the SARS collection process becomes more technologically advanced, tax practitioners must advise clients to avoid tax evasion and remain compliant. SARS will soon become so efficient at detecting tax evasion and recovering hidden revenues, it will no longer be worth it to lie on returns.

It seems the SARS Commissioner had an epiphany – make an example of delinquent taxpayers so others will fall in line. Apparently, following SARS’ media briefing on 30 July 2020, this is a deterrence tactic SARS will use in the coming filing season.

Financial crime in the world is a significant problem that South Africa and the global community have to deal with on a continual basis. A week hardly passes by where the media doesn’t report on a case involving alleged fraud, corruption or looting of funds that did not end up in the hands they were originally intended. This has the potential to devastate the economic balance.

As we approach Budget Speech Day on 26 February 2020, many people are wondering what kind of rabbit Finance Minister Tito Mboweni is going to pull out of his hat this year. Most commentators will talk about ‘bracket-creep’, sin taxes and an increase of 1% to the VAT rate. But the Minister needs to start becoming a little more creative.

SARS Commissioner, Edward Kieswetter, has used the South African Institute of Tax Professionals’ Tax Indaba as a platform to fire a shot across the bow, letting taxpayers know that non-compliance will be met with the full force of the National Prosecuting Authority (NPA).

In the past 20 years, threats and incidents of terrorism have grabbed global headlines and urged nations to step up laws against not only the act but also the financing of terrorist activities. In South Africa more recently, the spotlight fell on the threat of terrorism after a spate of incidents in which alleged bombs were placed in shopping centres around Durban.

Incorrect information and advice from tax practitioners, or in some cases South African Revenue Service (SARS) officials, has resulted in the misunderstanding of complex South African expatriate tax legislation, which has landed many South African in deep water with SARS.