The new draft legislation aims to give SARS the power to put you in jail if you make a mistake with your tax return.
The draft bill seeks to remove the concept of “intent” which in criminal law needs to be proven that you wilfully broke the law.
Removing this from the Tax Administration Act takes away the need for SARS to prove anything and you could go to jail for a simple mistake with your tax affairs.
There are so many common errors
Paying VAT and PAYE late – The payment of these taxes is sometimes due on a weekend and it is quite possible to make the payment on a Saturday which only reflects in SARS’s account on Monday. So off to jail you go for 2 years?
Adjustment to VAT Returns – VAT being a self-assessed tax sometimes is adjusted by the taxpayer for various reasons. This could lead to SARS not being paid correctly in the first instance. So off to jail, you go?
Late returns – Add to this a late income tax return because you were away on holiday or ill in hospital for that matter.?
Lost documents – misplaced supporting documents like a receipt or log book needed to prove a deduction leads to a lower tax payable….oops….off to jail you go?
A misinterpretation of expenses – could lead to understated taxable income. You thought you could donate some money to a needy family member not realising it was a donation from which SARS wants tax. No room for appeals or corrections…..off to jail you go?
So unfair compared to other crimes…..
This bill has some serious ramifications which quite frankly are grossly unfair to the South African taxpayer. Measure this against the consequences of breaking other laws such as corruption and fraud and theft – make a mistake with your tax return and you will end up in jail far more easily.