SEE ALL TODAY'S STORIES »

South Africa's tax amnesty fails to trigger significant inflows

22/08/2017 News Team

Only about 500 South African taxpayers have come forward so far under the country’s current tax amnesty, which expires on 31 August. About a tenth of the $3 billion, which had been hoped would be realised, is likely to come in, according to reports in Johannesburg.

The failure of the amnesty comes as no surprise, at a time when South Africa has been discussing a wealth tax for its richer citizens and claims that billions of rand have been siphoned away in corruption reaching high into the Zuma government.

The amnesty was launched in October last year but has only had 499 applications, according to sources at the South Africa Revenue Service, quoted by local media. 

So far, offshore bank accounts and property have been the most commonly declared assets.

The tax authorities are still urging people to come forward and declare when the automatic exchange of information under the Common Reporting Standard (CRS) becomes effective next month as well as the automatic exchange of information starts for a wide range of jurisdictions next year.

The amnesty was launched to allow South Africans to regularise their tax status ahead of the introduction of the CRS.

South Africa  has held two previous special amnesty opportunities – in 2003 and 2010 – and also operations the permanent Voluntary Disclosure Programme, which does not have a termination date. 

According to Andrew Wellsted, a director of law firm Norton Rose Fulbright, every disclosure programme since 2003 has been more onerous compared with the previous opportunity.

While the current SVDP deal is not attractive to many applicants, it is “unlikely that they will get a more favourable opportunity in future”, he said.

Share with Linkedin Share with Twitter
SEE ALL TODAY'S STORIES »

 RATE THIS ARTICLE
Poor   Average   Good   Excellent