South African Tax Amnesty Expected To Add R50 Billion To Economy

by Robert Lee, Tax-News.com, London

27 May 2005

More than R50 billion (US$7.6 billion) is expected to flow into the South African economy as a result of the government's amnesty on undeclared offshore assets which closed last year.

According to deputy finance minister Jabulani Moleketi, it is estimated that the exchange control levies could raise approximately R2.3 billion from the 35,198 applications already adjudicated.

In total, some 43,000 applications were filed under the amnesty which began in February 2003 and lasted for one year. Under the scheme, individuals were invited to declare their offshore assets without fear of prosecution in return for paying a 5% tax on money brought back to South Africa.

At the start of the amnesty, the South African Revenue Service (SARS) estimated that nationals had parked R90 billion in overseas accounts out of reach of the taxman.

Moleketi told parliament that all applications are expected to have been processed by the end of May, and finalised by the end of September 2005.

Recommended