Denise Williams
THE net is closing on companies that have taken extensive measures to avoid taxes, including those hiding profits in offshore tax havens and government contractors who have not fully disclosed their income to the taxman.
Finance Minister Pravin Gordhan said the government had set its sights on large multinational companies which make most of their money in South Africa but have moved most of their profits to tax havens abroad to avoid paying more taxes.
He said they were looking to root out such practices.
"The SA Revenue Service is currently engaging with companies that have their base of operations in SA but appear to have shifted a large proportion of their profits to low tax jurisdictions where only a few people are employed. This is unacceptable," Gordhan said.
He said this was in line with international practice where governments were challenging large multinationals that pay little or no taxes in the countries in which they operate.
Closer to home, the net is closing on South African companies which receive payments for government jobs but fail to disclose their full income.
SARS and the Treasury would be homing in on these companies and had already started an audit process to stamp out tax dodgers.
"By working closely with Treasury and interfacing with the government payment system, SARS has identified companies [that] have received payments but have not declared their full income," he said.
Gordhan also announced that Western Cape High Court Judge Dennis Davis would head the tax review commission announced by President Jacob Zuma during his state of the nation address earlier this month.
The commission would be tasked with evaluating tax policies to support public spending as well as to look into the mining royalties regime to ensure that royalties for mineral resources were suitably allocated to benefit the country.
