It will then be examined what role the Constitution and the Constitutional Court play in the rights of taxpayers. So much for the liberalization of the constitution and the transformation of SARS and tax law.
CHAPTER TWO
The South African Revenue Service
Introduction
The Transformation of the South African Revenue Service
- Tax reform
- Phase 1
- l.a The Katz Commission
- Phase 2
- The Siyakha project
The investigations carried out by the Katz Commission of Inquiry into certain aspects of South Africa's tax structure and the reports it produced were the first stage of reform. The second phase of the reform mainly concerned the expansion of the tax base and the adaptation of the tax system to international norms.
Conclusion
CHAPTER THREE
The Power of SARS
- Introduction
- The Income Tax Act
- Section 3
- Section 74B
- Section 7 4 D
- Section 8 8
- Section 91(l)(b)
- Section 92
- Section 9 9
- The Value Added Tax Act
- Section 5
- Section 36
- Section 37
- Section 4 0 ( 2 ) ( a )
- Section 4 0 ( 5 )
- Section 47
- The Customs and Excise Act
- Section 3
- Section 4
- Section 77G
- Section 114A
For the purposes of subsection (2), the Commissioner or any officer referred to in subsection (1) shall not enter a dwelling house or residential building (except any part thereof which may be occupied or used for commercial purposes) without the consent of the occupant. Any person may apply to the relevant division of the Supreme Court for the return of any information, documents or things seized hereunder.
CHAPTER FOUR
The Conduct Of SARS
Introduction
The respondent was inimical to the applicant's right to expect a fair administrative procedure and his right to protection under the Constitution. The interest in the case was due to the enormous powers the "Pay now, argue later" rule gives SARS.
CHAPTER FIVE
The Constitution
Introduction
- Delegation of duties and powers
The respondent is required to act in the spirit of the Constitution and the consequence of this is that in the exercise of his discretion. Any action taken by any person delegated by the Commissioner shall be subject to review in terms of section 2 of the Constitution.
- Rights
- Application of the Constitution
- Equality
- Privacy
- Property
- Access to information
- Just Administrative Action
- Access To Courts
- Self-Incriminating Evidence
- Limitation of Rights
Accordingly, in the interest of due administration of justice, this practice should be discouraged." The Baeta family then sought to obtain a copy of the order issued under section 74D of the Income Tax Act. The court dismissed the application also rejected for the same reasons.
CHAPTER SIX
The Constitutional Court
- Introduction
- Establishment
- The Constitutional Court as the Highest Court in South Africa
- The 1996 Constitution
- Constitutional Court Cases
- Cases before the Constitutional Court
- Relationship w i t h Parliament and Provincial Assemblies
- Conclusion
The Constitutional Court had an important role in drafting the new constitution. All cases that end up in the Constitutional Court must first go to the Supreme Court. The Constitutional Court has an important role to play in the rights and freedoms of individuals.
CHAPTER SEVEN
A Review of Constitutional Court Cases
Introduction
Ferreira v Levin NO and Others CCT 5/95
This case was referred to the Constitutional Court by the Witwatersrand Local Division of the Supreme Court (now High Court). They applied to the Supreme Court for an interdict barring their further questioning pending the determination of the constitutionality of section 417(2)(b). Kriegler agreed with certain points in the above statements, but did not agree with all of the above statements as a whole.
Harold Bernstein and Others v L. Von Wielligh Bester NO and Others CCT 23/95
The entire mechanism created under Sections 417 and 418 violates a whole cluster of interrelated and overlapping constitutional rights viz. a) the person's right to liberty and security. In the previous case, the Court had already found that section 417(2)(b) was unconstitutional. Seen in this light, I have no doubt that sections 417(3) and 418(2) constitute a legitimate limitation of the right to privacy under section 33 of the Constitution."
Rudolph and Another v CSARS CCT 13/96
The appellants appealed this decision to the Appellate Division (now the Supreme Court) and focused their attack on the constitutionality of section 74(3) of the Income Tax Act. Commissioner, that the delegation of this power to the Chief Director of Administration of the Ministry of Finance under Article 3(1) of the Act was invalid and that the authorizations were therefore invalid. Should it be held that this Court has such jurisdiction, one or more of the common law issues are admitted to be called into question.
Again, although Rudolph lost his case on what may be considered a technicality of timing, the legislature took note of the commissioner's admission and amended the aforementioned laws before another attack arose against these provisions. Ackermann J, in dismissing the reference, noted that the reference was defective in that the claimant had not exhausted his non-constitutional remedies, the Rules of Court had not been followed and counsel for the appellant's main submission was against section 91(1). b), in the Income Tax Act, even if this was not included in the application for referral. It must not be thought that this conclusion in any way implies that the provisions of the Act cannot be challenged; it relates solely to Mrs Motsepe's attempt to engage this Court in light of the validity of the sequestration and the other remedies available to her, which do not involve the constitutionality of any of the provisions of the Act.
Harksen v Lane NO and Others CCT 9/97
In the circumstances, I conclude that Article 21 does not meet the test of Section 33 and is therefore inconsistent with the provisions of the interim Constitution."') represents more than a nuisance or burden on the third spouse. It violates his/her dignity personal as an independent person within the conjugal relationship and perpetuates a vision of marriage made archaic by the values of the interim Constitution, thus being unfair under the terms of Article 8(2) of the Interim Constitution".
Mistry v Interim National Medical and Dental Council of South Africa CCT 13/97
34; Ultimately, the reasonableness and legitimacy of the powers granted to inspectors will depend on the overall system of checks and balances put in place to govern their powers. Such a scheme should take into account the legal and social framework within which inspectors should operate and include, where necessary, independent mandate. The importance of this case to taxpayers is that it accomplishes what the Rudolph case failed to do—essentially affirming that the search and seizure provisions of various revenue statutes would be found deficient if reviewed in light of the interim Constitution. .
Parbhoo and Others v Getz and Others CCT 16/97
Southwood J, agreeing with the applicants' concerns, found that section 415(3) read together with section 415(5) of the Companies Act was invalid to the extent that any self-incriminating evidence obtained at such an inquiry could not be used in criminal proceedings against may not be used. the person who gave the evidence. Ackermann J, with Chaskalson P, Langa DP, Kriegler J, Goldstone J, Madala J, Mokgoro J, O'Regan 3 and Sachs J concurring, affirmed the order of the High Court. This case was almost identical to that of Ferreira v Levin discussed above with that case examining section 417(2)(b) of the Companies Act.
In October 1995 the respondent brought an application before the Transvaal High Court challenging the decision to terminate the bursaries on the grounds that it was procedurally unfair and therefore a breach of section 24 of the Interim Constitution. It must be emphasized that section 24(b) (of the Interim Constitution) requires that administrative actions that affect or threaten legitimate expectations must be procedurally fair. I conclude that in the circumstances of this case the decision by the applicant to terminate the payment of bursaries to members of the respondent with real retroactive effect and without affording those members an effective opportunity to be heard, a violation of their right to procedural fairness was what was enshrined. in section 24(b) of the Interim Constitution."
Lesapo v North West Agricultural Bank and Another CCT 23/99
After his continued failure to pay, the Bank wrote a letter to the bailiff authorizing him to seize and sell the property. The matter was then referred to the Constitutional Court for confirmation of the order of invalidity in relation to Article 38(2). In the Constitutional Court, the respondent argued that Article 38(2) had not violated the rights of the complainant in terms of Article 34 of the Constitution for two reasons: .. a) Article 38(2) comes into force only if there is no dispute between the parties in regarding the debt and since there was no dispute Article 38(2). can be invoked without being unconstitutional; and .. b) the notification to the court messenger is preceded by a notification about the debtor's request and if he has a dispute, he has the opportunity to oppose it.
Pharmaceutical Manufacturers of SA and Another
For example, even in the event where the Commissioner invokes Section 74 of the Income Tax Act and obtains a warrant for the purpose of search and seizure, a Judge of the High Court must be approached to obtain such an order and he must be convinced that there are valid reasons for such action.
In re Ex Parte President of the Republic of South Africa and Others CCT 31/99
Dawood and Another v Minister of Home Affairs CCT 35/99
It cannot, therefore, be said that this article hinders access to the courts protected by Article 34 of the Constitution. The judgment of the Court was delivered by Ackermann J, with the rest of the judges unanimously concurring. It is against this background that the effect of the lien under section 114(l)(a)(ii) must be considered.
CHAPTER EIGHT
Relief And Remedy for the Taxpayer
- Introduction
- Non-Constitutional Avenue
- Alternative Dispute Resolution
- Appeal to the Tax Board
- Appeal to the Tax Court
- Administrative Avenue
- Constitutional Avenue
The ADR process must start no later than 20 days after the receipt by SARS of the notice of appeal from the taxpayer. The Tax Board is administered by the Clerk of the Board, usually an officer of SARS. The taxpayer will be present and may, with the permission of the Chairman, be represented by a legal representative.
CHAPTER NINE
The Promotion of Administrative Justice Act, 3 of 2000
- Introduction
- Definition of Administrative Action
- Definition of a Decision
- Review of Conduct
- Administrative Action Which Affects Any Person
- Reasons for Administrative Action
- Conclusion
In any event, the case would still be reviewable if the respondent challenged the appellant's action directly on the subpoena. From the above definitions it is clear that the discretionary decisions with which the Commissioner is authorized are reviewable in terms of PAJA. It is these delegation powers that are referred to in Article 6(2)(a)(ii) of PAJA.
CHAPTER TEN
TOOLS FOR THE TAXPAYER
- Introduction
- The SARS Income Tax Practice Manual
- Advance Rulings
- Introduction
- Disadvantages
- International Models
- The Proposed South African Model
- Conclusion
- SARS Service Monitoring Office
- The SARS Taxpayer Service Charter
The SMO reports directly to the Office of the Minister of Finance and must report to him regularly. The Constitution provides rights in the SARS Taxpayer Services Charter and in addition, in terms of PAJA, any decision taken by the Administrator must be supported by reasons for the decision. So, while the SARS Taxpayer Service Charter may appear to be merely a statement of good intentions by SARS to treat taxpayers fairly, it is vicariously liable for its actions in terms of the Taxpayer Charter.
CHAPTER ELEVEN
Common Law Assistance For The Taxpayer
Introduction
Legitimate Expectations
- Introduction
- South African Cases
- Conclusion
At the same time, while the concepts of liberty, property and existing rights are reasonably well defined, that of legitimate expectation is not. In relation to the SARS Manual of Practice, if there is no disclaimer and it is proved to be an accurate representation of the Commissioner's current practice, it can be supported from the point of view of legitimate expectation. The court found for the respondent (in that case the appellant) on the basis that he had a legitimate expectation arising from the letter.
The "Audi Alteram Partem" Principle
It should also be remembered that the "contra fiscum" rule does not apply to the interpretation of anti-avoidance provisions of the Income Tax Act (M. Kolitz Tax Avoidance).
CHAPTER TWELVE
Practical Problems Facing Taxpayers
Time
If the appeal were to be submitted to the Supreme Court of Appeal or even to the Constitutional Court, this would result in significantly higher costs for the appellant. If the applicant's constitutional rights were violated and he could not turn to this court due to lack of financial resources, this would certainly mean that he has no legal recourse. This appears to be an unfair advantage and perhaps a stumbling block in the protection of individual constitutional rights.
Unskilled Tax Advisors
On the commissioner's side, he has lawyers, staff and finances to meet any challenge. On the point (and on no other point) that tax advisers are generally crooks or incompetent, I agree with the Commissioner, although I believe that his campaign to register tax practitioners is both unworkable and foolish. On the other hand, since tax advisors in the future will be required to have a certain level of experience and qualifications, it would only be fair to require that SARS employees directly involved in issuing assessments also have a certain level must have knowledge of. competence, academic or.
CHAPTER THIRTEEN
Conclusion
Bibliography
Rudolph and Glynn Rudolph and Co (Pty) Ltd v CIR CCT 13/96
Premier of Mpumalanga v Koree Hojii Raawwachiiftuu Waldaa Manneen Barnootaa Mootummaa, Baha Transvaal CCT.
