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Ronnie Kasrils speaks out about tax row

Monday, 12 October 2015   (0 Comments)
Posted by: Author: Nicki Güles
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Author: Nicki Güles (News24 - City Press)

Former Intelligence minister Ronnie Kasrils has spoken out against a report into the so-called rogue Spy Unit at the South African Revenue Service (SARS), compiled by auditing firm KPMG, in which it was alleged that he could have "unlawfully" benefited from a reduction in interest on a tax payment.

Last week, City Press reported on draft findings contained in a memorandum to KPMG written by Sars' lawyers, which was leaked to City Press. The report states that "Sars should consider investigating circumstances that led to the reduction of Ronnie Kasrils' interest for the tax period between 1999 to 2006".

"In light of the activities of (former SARS acting commissioner Ivan) Pillay during the aforesaid period, it may as well be that the reduction of interest was done unlawfully and influenced by partisan political considerations. In an event where such reduction was made unlawfully, Sars should consider recovering the amount," the report states.

Kasrils explained to City Press this week that a bungle by his previous tax advisor - who failed to inform Sars that he was married to his late wife Eleanor in community of property, understated his expenses, and told the taxman that he had bought a house in the Cape Town suburb of St James for private and not investment purposes - had led to an initial tax bill of R255 000.

After Kasrils objected and his current tax advisor provided Sars with the correct information, the assessment was recalculated and the outstanding amount revised to just over R57 000. No interest was charged on that amount.

"My objection succeeded on merit and not political influence," he said this week.

Kasrils has provided City Press with all the documentation to support his version of events. City Press has redacted the name of his current and previous tax advisors, as well as the address of the Cape Town home.

"I paid my tax every year without fail," he said. "If Sars had provided the auditors with this documentation, they would have seen that there was no issue."

Kasrils - an outspoken campaigner against corruption - is now questioning why his name has been dragged into the Sars spy saga.

He also asked why KPMG auditors did not ask him about his tax matter, which could have easily been explained.

Kasrils was not the only one mentioned in the report not to have been interviewed by the auditors ­- former Sars commissioner and finance minister Pravin Gordhan, former executive and unit leader Johann van Loggerenberg, and Pillay were not interviewed either.

The report states that Gordhan should be "made to account” for the extension of Pillay’s contract in 2011, three years before it expired. Gordhan has repeatedly maintained that there was no wrongdoing involved in Pillay's contract extension.

Gordhan told City Press on Saturday: "I cannot respond to reports of documents I have not seen, or that have not been given to me.”

In a statement sent to City Press, Pillay said: "I am not the only person who has been denied an opportunity of defence against charges. To my knowledge, not one of the former Sars officials mentioned in the KPMG report ... have been called upon or been given any opportunity, either by Sars or by KPMG, to make representations or submissions to defend themselves."

The report found that Sars "established and administered a covert and rogue intelligence unit” in contravention of the law, an allegation Pillay denies. It also found that  Van Loggerenberg’s charity Wachizungu received ­donations from "Sars officials, taxpayers who were the subject of previous and ongoing Sars investigations, (and) service providers of Sars” which was "irregular, extraordinary, and not in accordance with good governance”, an allegation which Van Loggerenberg strongly denied.

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