• Dangerous games

    Employers' body Neasa is playing a potentially dangerous game, says Terry Bell.

  • Rational thinking

    All players should first consider the net result of their actions, says Leopold Scholtz.

  • Telkom's property poser

    BEE may be hindering Telkom's plans to offload redundant real estate, says Gugu Lourie.

Data provided by iNet BFA
Loading...
See More

Sars: Large companies avoiding tax in SA

May 08 2012 15:26 Reuters

Related Articles

Sars slaps firm with R136m tax bill

Taxman serves R10m bill on Malema

Sars mum on probe of men linked to Malema

Sars to clamp down on tax dodgers

Don't miss Friday deadline, says Sars

Gordhan: Warning for tax defaulters

 
Cape Town - South Africa has accused large multinational companies of using complex transactions to illegally reduce local tax payments, costing Africa's largest economy billions of rand.

"We have detected an increase in the use of cross-border structuring and transfer pricing manipulations by businesses to unfairly and illegally reduce their local tax liabilities," Oupa Magashula, commissioner at the South African Revenue Service (Sars), told parliament's finance committee on Tuesday.

African countries are vulnerable to higher revenue loss through tax crimes because of a lack of knowledge on detecting and prosecuting sophisticated evasion tactics.

"A company will always try and actually maximise its after-tax profit... and a one or two percent movement one way or the other could have a decisive impact on profits," said Bob Head, a chartered accountant and special adviser to Magashula.

"There are some people in the business of trying to help companies not pay tax and they will keep on inventing new schemes," Head said.

Sars has raised more than R5bn through audits and additional assessments on large corporations, but it was difficult to quantify the exact cost to government, a tax official said.

Sars has ratcheted up targeted interventions in high risk areas, including transfer pricing by large businesses, incomes of wealthy South Africans and the illicit cigarette industry.

South Africa has 12 million registered entities - including individuals, companies and trusts - and collected R743bn in taxes in the last financial year.
sars  |  tax evasion
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
22 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're talking about:

Small Business

A cash flow crunch often occurs in small businesses trying to balance cash coming in with cash going out. Watch this video to help you improve.
 
 

Go solar and save

Households may have to examine alternative forms of energy after Eskom has been given permission to raise electricity prices above the 8% previously granted.

 
 

Start saving...

Where can you stash your cash?
Time the key for retirement saving
Dummy's guide to saving
Save money with affordable account

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...