South African Tax Chief Chides Groups That Use Tax Havens

by Jason Gorringe, Tax-News.com, London

25 October 2005

Commissioner for the South African Revenue Service, Pravin Gordhan, has issued a stinging rebuke of individuals and companies which make use of tax havens to reduce their tax liability, arguing that such activities helped to stymie development in the world's poorer countries.

Responding to questions at a press conference following a meeting of the National Assembly finance committee, Mr Gordhan revealed that the government does not seem to know how many South Africans have assets in offshore jurisdictions, but would clearly like to.

"We wish we knew. If we did know, we are not going to tell you either," he remarked.

Nonetheless, citing a recent report by Christian Aid, Mr Gordhan told reporters that US$11 trillion in assets were held offshore, depriving developing nations of US$500 billion in tax revenues.

"This is triple the amount of aid (to developing nations) in any one year," he noted.

According to Gordhan, multinational companies are especially complicit and are deserving of "special mention" among the groups that "promote tax injustice".

Christian Aid's report was however immediately rubbished by economists worldwide.

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