The South African Revenue Service (SARS) is going after sin taxes owed to it from the illicit sale of cigarettes in the country.
Moloto said that SARS – and the nation’s economy as a whole – suffered the most from the ban, with R19 billion lost in terms of revenue from excise duties.According to the revenue service, the revenue generated from high-volume daily consumables – namely, alcohol, tobacco, petrol and some luxury items – makes up approximately 10% of the total revenue received by SARS.
The group noted that cigarettes were selling for as little as R8 per pack – less than one-third of the minimum collectable tax .to sell illicit tobacco. Through its Criminal and Illicit Economic Activities and Customs Divisions, it carried out inspections and search and seizure operations on cigarette companies and manufacturers in KwaZulu-Natal, Western Cape and Gauteng.
“Those who systematically and deliberately set out to deprive what is due to fiscus through fraudulent and other non-compliant activities will be confronted and dealt with. This kind of conduct will be made hard and costly,” he said.On 26 August, SARS won a preservation order against Gold Lead Tobacco, a company with factories in South Africa and Zimbabwe, that has been accused of the illegal sale and smuggling of cigarettes.
A preservation order is obtained to prevent realisable assets from being dissipated, thus frustrating the collection of taxes, said SARS.
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