Sars plans further global co-operation on customs fraud

Culprits will be apprehended and prosecuted RAY SMUTS THE RECENT mutual administration agreement signed between The People’s Republic of China and South Africa is expected to be the first of many, SA Revenue Service commissioner Pravin Gordhan told the Cape Times-Safmarine Breakfast Club in Cape Town last week. Gordhan said he hoped to sign similar agreements with the administrative heads of India and Brazil later this month, designed to facilitate the prosecution of customs fraud and facilitate trade and the exchange of documentation. Alluding to the recent statement by finance minister Trevor Manuel, that R30 billion would be made available, half of it for World Cup 2010 transport and infrastructural development, the commissioner said the entire amount had come from personal income tax collections. Whereas Manuel had indicated Sars would be collecting R133 billion from personal tax, the figure was closer to R138 billion. “On corporate tax the amount is even more phenomenal but it is hard to predict what companies are going to declare as their profitability. “In February, we thought it would be R96 billion. We now think it’s going to be almost R116 billion, with VAT up by about R1.7 billion over what was originally anticipated.” Gordhan said the question of tax non-compliance was a growing global problem which in its many forms included “outright fraud”. The Justice Network has found that some US$11.5 trillion is held offshore by rich individuals and companies around the world while some countries are losing R500 billion in tax annually through tax avoidance. “What the recent Tax Amnesty showed us is that South Africans have taken lots of money in the past, with some R65 billion declared during the amnesty period. Our responsibility is to find those individuals or entities who still have not played ball and continue to defraud this nation in what they see as their constitutional right.”