Shoprite founder Wiese in R3.7bn tax evasion dispute
Billionaire slams allegations of fiscus evasion
One of the country’s richest men and a co-founder of Shoprite, Christo Wiese, has been drawn into an alleged elaborate tax-dodging scheme under scrutiny by the South African Revenue Service.
Investigative journalism team amaBhungane yesterday published details of a complex web of transactions involving Africa’s largest law firm ENSafrica and multinational oil company Tullow Oil.
The details were laid out in hundreds of pages of documents at the Western Cape High Court in Cape Town‚ in which SARS outlined its case‚ describing how ENS allegedly devised a way for Tullow‚ which had been restructured‚ to get assets worth R3.9billion out of SA‚ without paying certain taxes.
“Tullow’s restructure left ENS in charge of a holding company that contained a tax shelter‚ which ENS then sold to Wiese. When SARS came knocking‚ Wiese allegedly moved assets out of the company and sold it to a then ENS partner who told SARS there was no cash or assets left to claim‚” said the report by amaBhungane.
“Now SARS is going after Wiese‚ the former ENS man and two others personally for R217-million‚ part of a R3.7billion tax claim rooted in the Tullow restructure.”
Wiese yesterday denied the allegations, telling eNCA they are “completely unfounded, misrepresented”.
“The tragedy is a lot of commentators have difficulty reading English.
“If you read the article you will see that there are two issues where there is a dispute with SARS. The first one is for an amount of R3.7-billion, which has absolutely nothing to do with [Wiese’s group] Titan. The second one is for an amount of R217-million where there is a dispute between three of four individuals with SARS, which is a subject of a court matter which will be adjudicated soon,” said Wiese.
The multibillionaire found himself entangled in the controversy surrounding the collapse of Steinhoff late last year. The revelations are the latest in a number of scandals that have hit the SA corporate sector in the past few years, reviving charges that the private sector is as riddled with corruption as the public service.
Sunday Times reported in 2012 that SARS had slapped the supermarket magnate with a R2-billion tax bill – at the time the largest single tax claim yet lodged in South Africa.
Wiese was targeted for allegedly under-declaring income in a labyrinth of companies and trusts. Wiese said he had nothing to hide and emphasised that not once in his career was he found to have short-changed the fiscus.
AmaBhungane said details of tax disputes were usually protected by tax secrecy laws‚ but because Wiese’s matter had surfaced in an open court‚ the public were able to get a rare view of the role allegedly played by lawyers and tax advisers in helping people and companies to “avoid tax”.
ENS tax head Peter Dachs denied there was tax evasion. Tullow did not respond to questions.
In the 1990s, Wiese engineered a move that saw Shoprite acquire supermarket chain OK Bazaars Group, which owned 139 stores and 18 Hyperamas, from South African Breweries for R1.
In 2009, he was nabbed by custom officials in London after he tried to board a flight to Luxembourg carrying suitcases with $1-million. –