National tax laws have not kept pace with the globalisation of corporations and the digital economy, leaving gaps that can be exploited by multi-national corporations to artificially reduce their taxes.
OECD's 15 step Action Plan on Base Erosion and Profit Shifting (BEPS) offers a global roadmap that will allow governments to collect the tax revenue they need to serve their citizens. It also gives businesses the certainty they need to invest and grow.
As a developing country we depend heavily on tax revenues. Consequently, creating robust and equitable tax policies and implementing fair and effective tax systems has become critical.
So how feasible is the 15 step Action Plan within South Africa and Africa as a whole?
Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.