The South African Revenue Service (Sars) has stepped up its efforts to stamp out the misdeclaration of goods to avoid paying import/export duties.
Sars Commissioner, Edward Kieswetter, made a call to revenue collectors and government officials on Thursday to work together in the fight against illicit trading practices, which he says are costing the country millions.
“The losses in tax revenue and the negative impact on our domestic economy affects industries, erodes employment opportunities, and generally denies the most vulnerable in society the social and economic wellbeing they deserve,” said Kieswetter.
On top of failing to pay import/export duties, many traders are exploring ways to avoid paying value-added tax (VAT) on goods, which Sars says is hindering their ability to collect money to develop the country.
Additionally, Sars warned that cheap imports were hurting locally produced goods, with the textile and clothing industries, in particular, taking the brunt.
“Another negative impact of illicit trade is the erosion of productive capacity in the country, as goods are imported rather than produced locally. This in turn leads to job losses, which aggravates already high levels of poverty and inequality,” said Kieswetter.
The Sars move follows a claim by the National Consumer Commission (NCC) yesterday that certain suppliers in the textile industry had attempted to bribe government officials after it was discovered they were importing cheap, counterfeit textiles.