By Lehlohonolo Lehana.
The South African Revenue Service (SARS) has welcomed a preservation order granted against Gold Leaf Tobacco Corporation and two of its directors.
The order, in terms of section 163 of the Tax Administration Act, was granted by the North Gauteng High Court on Thursday
In a statement, SARS said it had been investigating and clamping down on the illicit economy, focusing on the tobacco, gold and fuel industries over the last year.
“This is one of the many enforcement steps executed by SARS.
“SARS is harnessing its capabilities to make non-compliance with legal tax obligations hard and costly to those who are engaged in this criminal pursuit,” said the revenue collector.
The preservation order is obtained to prevent realisable assets from being dissipated, thus frustrating the collection of taxes.
“The conduct of non-compliant taxpayers is depriving government of legitimate resources to the prejudice of both the State and the South African public. In aggressively addressing this scourge, SARS will continue to pursue its mandate without fear, favour or prejudice,” says SARS Commissioner, Edward Kieswetter.
He said the preservation order was obtained to prevent realisable assets from being dissipated thus frustrating the collection of taxes.
A report commissioned by British American Tobacco South Africa (BATSA) and conducted by market research firm Ipsos last year revealed that Gold Leaf Tobacco Corporation’s products were among the cheapest on offer in the market, priced below the minimum collectable tax amount of R21.60 instead of the minimum price of R28 per pack of 20 cigarettes.
At the time, GLTC emphatically denied all and any allegations of illicit trading and instead said that it was making a significant steady contribution of R200 million per month to the South African economy through the payment of all its taxes.