Experts Urge Government To Disclose SA Amnesty Results

by Robert Lee, Tax-News.com, London

07 October 2003

South African tax experts are calling on the government to throw open the books on its exchange control amnesty to allow closer scrutiny of the results so far.

According to the unit administering the amnesty, there have been 2000 applications from investors wishing to repatriate their funds illegally transferred offshore, and a member of the unit disclosed that applications were growing at a rate of 100 per day according to a report in the South African Sunday Times. However, the authorities have been reluctant to reveal details of the amnesty applications received so far saying the information received was of a "sensitive nature".

Nevertheless, tax experts such as Ernset Mazansky, a director at Werkmans Tax, said revealing the number of applications achieved nothing, arguing a monetary value of the applications would give a more useful indication of how the amnesty was progressing.

Beric Croome, a tax director at Edward Nathan and Friedland considered that the number of applications received to date is rather low, though he explained that the numbers could be bolstered by the unwinding of so-called 'loop structures' according to the Times. This is where offshore entities were formed to invest in South African shares or other domestic targets, having the effect of exporting capital from South Africa in contravention of the exchange control laws.

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