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KNOWING YOUR RIGHTS WILL MAKE NEGOTIATING NEW TAX LEGISLATION EASIER

Durban - 2 November 2009. The new Tax Administration Bill, released by SARS and the National Treasury in Johannesburg for public comment on Friday, is a controversial balancing act - tightening the reins on tax collection without overstepping constitutional rights.

According to tax authority Stiaan Klue, the new Bill will empower SARS officials to act as judge and jury.   Although case law is limited, Klue’s view is that it is critical that taxpayers – both corporate and individual – understand not only their obligations, but also their rights in cases where they may be investigated by SARS.

“The new Tax Administration Bill seeks to provide a single body of law that outlines common tax administration procedures, rights and remedies to achieve a balance between the rights and obligations of both SARS and taxpayers in a transparent relationship,” says Klue who is Chief Executive at the South African Institute of Tax Practitioners and author of the new LexisNexis Silke on Tax Administration publication.

LexisNexis Silke on Tax Administration is the first comprehensive guide to tax administration and taxpayers’ rights in South Africa. The publication guides South African businesses and taxpayers through their rights and outlines the investigation and audit powers of SARS.

Topics covered in this publication include an outline of various tax laws, constitutional aspects of tax administration, tax registration, return assessments, administrative penalties, payment of taxes, refunds and SARS’ collection powers.

According to Klue, in certain cases SARS has powers which may be seen to be unconstitutional, but are in fact constitutional due to the general limitation provision in the constitution. For the average taxpayer, normal constitutional rights apply, and these need to be understood.

With reference to tax collection, these include the principle that all taxpayers – whether self employed or salaried – are equal before the law and have the right to equal protection and benefit of the law. SARS can therefore not discriminate against any taxpayer when expenses are deducted or when auditing checks are performed.
“All taxpayers also have the right to privacy which means that taxpayers must under the current law be notified by SARS before physical audits are carried out,” says Klue. Under the proposed Tax Administration Bill, this is changing.

According to the Bill of Rights, taxpayers have the right to property and to be properly assessed before SARS can take action. No taxpayer’s home or property may be searched, their possessions may not be seized and the privacy of their communication may not be infringed by any authoritative body - unless it is in the public’s interest.

The right of access to information also means that if a taxpayer applies for a penalty to be waived due to extenuating circumstances, the taxpayer has the right to request the minutes of the meeting to determine whether the case was properly assessed by the SARS penalty committee.

Klue supports SARS efforts against tax evasion and aggressive tax avoidance, but is of the opinion that these efforts should not threaten the constitutional rights of honest taxpayers.

Two weeks ago SARS released increased tax administrative penalties that will come into effect on November 23. LexisNexis Silke on Tax Administration is the only publication in the country that deals with the detail of these substantially increased penalties.

LexisNexis – South Africa’s leading global provider of content-enabled workflow solutions – offers a comprehensive range of research solutions, including business publications in the area of corporate and commercial law. Authoritative publications are highly regarded as sources of accurate, current and reliable information.

Companies and individuals who would like to get to grips with their taxation rights can order Silke on Tax Administration from LexisNexis at R610.00, excluding VAT and handling. For more information, or to order your copy, call 0860 765 432 or visit This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

About LexisNexis

LexisNexis® is a leading global provider of content-enabled workflow solutions designed specifically for professionals in the legal, risk management, corporate, government, law enforcement, accounting, and academic markets. LexisNexis originally pioneered online information with its Lexis® and Nexis® services. LexisNexis serves customers in more than 100 countries with 18,000 employees worldwide. LexisNexis is a member of Reed Elsevier [NYSE: ENL; NYSE: RUK]. In South Africa, LexisNexis is 50% owned by Reed Elsevier and 50% owned by Kagiso Media, a leading empowerment group.

Issued by: Amelia-May Woudstra
Ogilvy PR, Cape
Contact: 021 467 1063 or 072 320 2408

On behalf of: LexisNexis
Contact: Shannon Ambrose
Tel: 031 268 3111

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