Page 1112 - SAIT Compendium 2016 Volume2

MEMORANDUM ON THE OBJECTS OF TAX ADMINISTRATION LAWS AMENDMENT BILL, 2015
2.67 Tax Administration Act, 2011: Amendment of section 229
The proposed amendment is of a textual nature and furthermore broadens the voluntary disclosure relief to include 100% relief in respect of administrative non-compliance penalties imposed under Chapter 15 of the Tax Administration Act or another tax Act for the late payment of a tax.
2.68 Tax Administration Act, 2011: Amendment of section 235
The purpose of section 235(2) is to assist the prosecution in proving tax offences such as tax evasion, which is necessary given the fact that if the State is unable to effectively prosecute those who defraud it of revenue which rightly belongs in the public coffers, the tax system will be undermined and signi cantly weakened. The provision assists the prosecution where it can show that a person has made a false statement but cannot conclusively show that the person was aware of the falsity of the statement, i.e. proving the absence of reasonable cause for making the statement. Almost invariably the information relevant to the determination of reasonable cause was peculiarly within the knowledge of the accused. In terms of the provision, although potentially an incursion into the right to silence, the person does not have a ‘reverse onus’ (which was the case under previous tax laws) to factually prove his or her innocence, but will only have an ‘evidentiary burden’ to prove that there is a reasonable possibility that the he or she was ignorant of the falsity of the fraudulent statement and that such ignorance was not due to negligence. This is aligned with the approach taken by the Constitutional Court in the cases of S v Manamela and Another (Director-General of Justice Intervening) 2000 (3) SA1 (CC) and S v Singo 2002 (4) SA858 (CC). In these cases the Constitutional Court, that has consistently struck down reverse onuses which place a burden on an accused person to prove any facts in his or her defence on a balance of probabilities, has exercised its remedial powers under section 172(1) of the Constitution, to strike down the reverse onuses, but to replace them by reading in evidentiary burdens in their place. However, based on further legal review there is a risk that on a literal interpretation of the provision, particularly the use of wording such as ‘must’ and ‘be regarded as guilty of the offence’, a court may nd that it still gives rise to a reverse onus rather than an evidentiary burden. To ensure certainty that the provision can only constitute an evidentiary burden, the amendment is proposed.
2.69 Tax Administration Act, 2011: Amendment of section 236 The proposed amendment is a technical correction.
2.70 Tax Administration Act, 2011: Amendment of section 251
The proposed amendment aims to clarify that a delivery may also be made to a registered user’s electronic ling page. A registered user is a person who has registered for a SARS electronic ling service such as eFiling, esyFile, a third party data submission channel or such like and their electronic ling page is akin to a web based e-mail used exclusively by SARS and the person to whom the page belongs. The proposed amendment will come into effect on the date that the electronic communication rules issued under section 255 were published, i.e. 25 August 2014.
2.71 Tax Administration Act, 2011: Amendment of section 252 See paragraph 2.70.
2.72 Tax Administration Act, 2011: Amendment of section 256
SARS is often approached to verify the Tax Compliance Status of an entity for periods before the current date of the request. The proposed amendment enables SARS to provide the tax compliance status of a taxpayer irrespective of the period to which the request relates in order to assist in the review of past transactions by the taxpayer’s auditors and regulatory authorities.
2.73 Tax Administration Act, 2011: Amendment of section 257
The proposed amendment aims to align this provision with the amended wording of section 256 and furthermore enables the Minister of Finance to prescribe by regulation when SARS must report updates of or a change in the tax compliance status of certain taxpayers, for example taxpayers with government contracts.
2.74 Tax Administration Act, 2011: Amendment of section 270
The proposed amendment aims to further alleviate unintended consequences of the retrospective application of an understatement penalty. Section 187(3)(f) provides that the effective date for purposes of the calculation of interest in relation to an understatement penalty, is the effective date for the tax understated. As Chapter 12 (together with the accompanying amendments to the interest provisions of the various tax Acts as contained in Schedule 1 to this Act) will only come into effect upon a date to be determined by the President by proclamation, the payment of interest on an understatement penalty under section 222 would have to be calculated in the manner that interest on additional tax (the predecessor to understatement penalties) was calculated under the relevant interest provisions of the speci c tax Act. The proposed amendment inserts a transitional provision to this effect with a speci c effective date, i.e. the effective date as referred to in section 187(3)(f), for tax understated before the implementation date of the Tax Administration Act, will be regarded as the commencement date of the Act, i.e. 1 October 2012. Once Chapter 12 (together with the accompanying amendments to the interest provisions of the various tax Acts as contained in Schedule 1 to this Act) has been promulgated, the accrual and payment of interest on an understatement penalty will be calculated in the manner prescribed by Chapter 12 in respect of an understatement penalty imposed after such date.
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