Court af­firms SARS’ power to col­lect tax

The tax­payer is not af­forded op­por­tu­nity to op­pose the grant­ing of the judg­ment

Business Day - Business Law and Tax Review - - BUSINESS LAW & TAX REVIEW - TIM DES­MOND

THE South African Rev­enue Ser­vice (SARS) has ex­ten­sive pow­ers to col­lect tax. These pow­ers are con­tained in var­i­ous tax laws and are in­tended to fa­cil­i­tate the prompt col­lec­tion of tax that is due. There have been a num­ber of court cases deal­ing with the lim­i­ta­tions of SARS’ col­lec­tion pow­ers.

The Western Cape High Court re­cently gave judg­ment in a case deal­ing with SARS’ col­lec­tions pow­ers. The case re­lated to a judg­ment ob­tained by SARS against Fast­mould Spe­cial­ist CC in re­spect of Value-Added Tax (VAT) and em­ploy­ees’ tax. The VAT Act and the In­come Tax Act both con­tain pro­vi­sions al­low­ing SARS to ob­tain judg­ments against tax­pay­ers by fil­ing a state­ment with the clerk or reg­is­trar of any com­pe­tent court. The tax­payer is not af­forded an op­por­tu­nity to op­pose the grant­ing of the judg­ment.

Fast­mould ap­plied to the Goodwood Mag­is­trates Court for the rescis­sion of SARS’ judg­ment against it.

That ap­pli­ca­tion was suc­cess­ful.

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