From October 2017 the South African Revenue Service (Sars) will intensify criminal proceedings against tax offenders, it said on Thursday.
The reason for the intended clamp down is because Sars has noticed an increase in taxpayers not submitting their tax returns by the stipulated deadlines, and not settling their outstanding debt with the revenue collection agency.
According to Sars, this is not limited to the current tax year, but includes substantial non-compliance across previous tax years.
In terms of the Tax Administration Act it is a criminal offence not to submit a tax return for:
Personal Income Tax (PIT)Corporate Income Tax (CIT) Pay As You Earn (PAYE) Value Added Tax (VAT) Failure to submit return(s) within the relevant period could result in:
- Administrative penalties being imposed on a monthly basis per outstanding return;
- Criminal prosecution resulting in imprisonment or a fine for each day that such default continues. Should any return result in a tax debt it must be paid before the relevant due date to avoid any interest for late payment and legal action.
To avoid any penalties, interest, prosecutions as well as imprisonment, Sars urges taxpayers to rectify their compliance by submitting any outstanding returns as soon as possible at their nearest Sars Branch or via Sars eFiling.
Earlier this month Fin24 reported that Sars has allegedly missed its first-quarter tax revenue target by R13.1-billion. If this trend continues, it would miss its overall target by about R50-billion in 2017. Sars set a collection target of R1.265-trillion for the year.
This was according to a document seen by Fin24.
A shortfall of this scale is expected to have a severe impact on Finance Minister Malusi Gigaba’s mini budget in October, where he will need to find extra revenue to allocate to budgets planned for social grants, state-owned entities, departments, provinces and municipalities.
SA's 2017 budget started the year with a deficit of R149-billion, which was 3.1% of the country's gross domestic product (GDP).