Judge Davis: I am com­mit­ted to Sars’ suc­cess

CityPress - - Business -

Dear Sir, our ar­ti­cle “Sars at risk of im­plod­ing” (March 5 2017) refers. In the ar­ti­cle, a speech I de­liv­ered on base ero­sion and profit shift­ing was de­scribed.

I un­der­stand the dif­fi­culty of sum­maris­ing a 40-minute speech, par­tic­u­larly when no writ­ten copy is dis­trib­uted, but, un­for­tu­nately, the re­port needs some cor­rec­tion.

The way I ap­proached the ques­tion of the in­tegrity of the SA Rev­enue Ser­vice (Sars) was to say that the con­tin­u­ing fo­cus on Sars in the pub­lic do­main has raised per­cep­tions that can only harm this crit­i­cal in­sti­tu­tion.

I am ex­tremely con­cerned with neg­a­tive press coverage of Sars; hence, the prob­lem

Yof per­cep­tion. The Davis Tax Com­mit­tee is not in a po­si­tion to make any sub­stan­tive as­sess­ment on the mer­its of this un­for­tu­nate coverage. I cer­tainly did not sug­gest that Sars was not staffed with a num­ber of highly tal­ented per­son­nel – on the con­trary.

How­ever, the prob­lem is that in deal­ing with multi­na­tional cor­po­ra­tions, con­sid­er­able re­sources are needed and it is my view that Sars needs fur­ther sup­port to curb base ero­sion and profit shift­ing, an as­ser­tion that holds true for rev­enue au­thor­i­ties around the world.

On nu­mer­ous oc­ca­sions, I have stated that I gather Sars is strength­en­ing its trans­fer pric­ing unit and that is to its great credit.

Sim­i­larly, it is not Sars that cre­ates the de­ter­rent for tax evaders to par­tic­i­pate in an amnesty, but, as I em­pha­sised, there is a need for the Na­tional Prose­cut­ing Au­thor­ity to be skilled to deal with com­plex tax eva­sion in or­der to pros­e­cute of­fend­ers.

I have con­tin­ued to say that I have lit­tle doubt that Sars on its side will en­sure the suc­cess of the new Vol­un­tary Dis­clo­sure Pro­gramme.

Fi­nally, I re­gret that your cor­re­spon­dent did not re­alise that a ref­er­ence to high-net-worth in­di­vid­u­als at the Jo­han­nes­burg Bar was said in jest!

As to the col­lec­tion fig­ures, I did ques­tion whether a down­turn in the econ­omy can ex­plain com­pletely the re­duc­tion in tax col­lec­tion, but never sug­gested that the fault lies with Sars.

In­deed, it is my view that there is a need to wait un­til the end of the month when fi­nal fig­ures are an­nounced be­fore mak­ing any fi­nal judge­ment in this re­gard.

I and the tax com­mit­tee are deeply com­mit­ted to en­sur­ing with Sars that tax col­lec­tion and ad­min­is­tra­tion con­tinue to be world class – hence the need for me to clar­ify your re­port. Yours sin­cerely Den­nis Davis Chair­per­son: Davis Tax Com­mit­tee

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