SARS To Target Ten Industries In Tax Evasion Inquiry

by Robert Lee, Tax-News.com, London

20 May 2003

The South African Revenue Service has announced recently that it intends to hold talks with representatives from ten industries with regard to tax evasion, according to a Business Report article.

Commissioner Pravin Gordhan made the announcement to the portfolio committee on finance, but did not openly identify which industries will be targeted by the SARS. The commissioner explained that the initiative will complement a similar scheme undertaken in other business sectors including oil, textiles, fishing, liquor and retail, and predicted that it will bring in "a fair amount of money".

Gordhan cited as an example the case of Grant Ramsey, managing director of Galahad Business Solutions, who was charged with evading some R177 million worth of tax and gave the authorities information on 400 other firms involved in illegal tax avoidance. Such instances underline the fact that "it is better to work with SARS" Gordhan announced, warning that failure to work with the revenue service will result in legal action being taken in tandem with the public prosecutor.

The Commissioner refuted suggestions that SARS unfairly targets wealthy individuals, explaining that evidence from overseas points to the fact that high net worth individuals are a major source of tax evasion and that therefore the tax authority is justified in looking into their affairs.

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