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DA asks SARS to check Zuma's tax compliance

The Democratic Alliance (DA) has asked the South African Revenue Service (SARS) commissioner Oupa Magashula to investigate whether President Jacob Zuma and his donors paid taxes on the millions of rand - apparently more than R7m - that was allegedly transferred to him between 1995 and 2006.
According to media reports, the payments were made to Zuma by his convicted financial adviser, Schabir Shaik, (R4m), former president Nelson Mandela (R1m), businessman Jürgen Kögl (R1m), and sundry amounts of about R1m by Zuma's nephew, Khulubuse Zuma, his attorney Julie Mahomed and Durban businessman Vivian Reddy.

DA finance spokesman Tim Harris said on Tuesday (11 December) he had filled in the necessary forms to report Zuma for suspected non-compliance with the Income Tax Act.

"The DA believes that this matter should be investigated and that all South Africans, including the president, should be duty bound by the laws of the land," Harris said.

His request for an inquiry came in the wake of an exposé by the Mail & Guardian of a draft forensic report that accounting firm KPMG compiled for use in the subsequently abandoned trial of Zuma on charges of corruption.

The report tracked the payments allegedly made either directly to the president or to his creditors and banks to settle his debts.

Presidential spokesman Mac Maharaj said he had no comment to make on DA statements but SARS spokesman Adrian Lackay confirmed that the tax authority had received correspondence from the DA that would be dealt with "in the normal course of SARS business, as would be the case with any other taxpayer, complaint or allegation".

He stressed that SARS was bound by the confidentiality provisions of the law. "Taxpayer confidentiality extends to whether or not a taxpayer is under investigation and ends only when a matter is formally brought before a court of law, other than a tax court," Lackay said.

Harris explained that in terms of the Income Tax Act many of the payments made to Zuma might be classified as donations and therefore possibly subject to donations tax.

"According to section 60(1) of the act, if a donor fails to pay donations tax within a prescribed three-month period, both the donor and the person receiving the donation will be jointly liable to pay the outstanding amount of donations tax," he said.

"This, of course, assumes President Zuma accepted the donations without rendering any services in exchange.

"If this was not the case, then the transfers could instead form part of the president's total income and be subject to normal income tax," Harris added.

Source: Business Day via I-Net Bridge


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