It is said that there are two things in life that we can count on - one is that we will die and the other is that we will have to pay taxes! Having said that, we are constantly reminded, on TV, in magazines etc that people are constantly trying to cheat death! We all know what happens there, so it stands to reason then, that it is not a good idea to try and cheat on our taxes!
Beware, you will be caught! Just don't go there!
Sars targets corporate tax avoiders
January 10 2007 at 08:40PM
Corporate re-organisations structured to avoid tax will be challenged, the South African Revenue Service (Sars) said on Wednesday. Sars was watching corporate re-organisations involving large South African entities, said Commissioner Pravin Gordhan.
Certain transactions were being structured "in such a way that they show complete and reckless disregard for tax morality and South African tax law", he said. "Through elaborate structuring, these deals seek to deliberately avoid the tax consequences that should flow from the associated transactions, thereby robbing not only the fiscus of tax revenue, but all South Africans." Gordhan said Sars would "carefully examine" these transactions for tax compliance.
"The architects of certain tax-aggressive structures will not be permitted to abuse South Africa's tax provisions in ways clearly unintended by the legislature. They will be vigorously challenged."
He called on corporate leaders to ensure the advice they pursued did not undermine the country's tax base. "We once again urge institutions involved in designing aggressive tax schemes intended to abuse the law and deprive the fiscus of its fair share of revenue to desist from such schemes. "These are the activities that lead to complexity in our tax law." Gordhan said Sars would work with shareholders, investors and their advisers to understand their intentions and commitment to poverty alleviation and the country's development, and how structuring of transactions supported this.
He called on corporate leaders to ensure the advice they pursued did not undermine the country's tax base. "We once again urge institutions involved in designing aggressive tax schemes intended to abuse the law and deprive the fiscus of its fair share of revenue to desist from such schemes. "These are the activities that lead to complexity in our tax law." Gordhan said Sars would work with shareholders, investors and their advisers to understand their intentions and commitment to poverty alleviation and the country's development, and how structuring of transactions supported this.
Sars spokesperson Logan Wort said Sars was looking at both legal tax avoidance and illegal tax evasion. He declined to name any companies or individuals suspected of either practice. Wort said the challenge of tax law internationally was compliance with the both the letter and spirit of the law. Some companies were believed to be setting up "aggressive tax structures" primarily to avoid paying tax rather than to further their businesses and, while this was not technically illegal, itwas against the morality of the tax laws. Wort said that where companies were acting illegally, Sars was warning them. Where they were aggressively avoiding tax, Sars was appealing to their morality to comply with the spirit of the law. - Sapa
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