Sars won't back down on Malema tax debt

2015-06-02 17:35
Julius Malema (File: Foto24)

Julius Malema (File: Foto24) ((Denvor De Wee, Foto24))

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Pretoria - Economic Freedom Fighters (EFF) leader Julius Malema's compromise agreement over money he owed the taxman fell away when his sequestration application was withdrawn, the SA Revenue Services (Sars) said on Tuesday.

"It is important to note that the Court made no finding that Sars is bound by the compromise agreement with Mr Malema that it entered into in May 2014," it said in a statement.

No concession has been made by Sars with respect to the recovery of the current and future outstanding taxes, it added.

It would continue to "take the necessary steps available to it in terms of the Tax Administration Act to recover all tax debts that might be due'' without compromising its independence or impartiality", the statement read.

Sars spokesperson Luther Lebelo said, in terms of the Tax Administration Act, he was not allowed to disclose whether Malema would pay more or less than the amount he owed before the sequestration proceedings.

But he said that when they initially decided to sequestrate, Malema was not co-operating much. 

"Since then there has been lots of behaviour of compliance - he is giving us hope he will comply - let's give him an opportunity."

The statement comes after Monday's stop-start proceedings in the High Court in Pretoria in which a Sars sequestration order against Malema was supposed to have been made permanent.

If this had gone through, Malema would not have been able to keep his seat in Parliament, because it is against the rules.

At last year's election, the EFF came in from nowhere to become a robust and outspoken voice against poverty and the alleged abuse of state funds on security upgrades to President Jacob Zuma's home.

Before being a co-founder of the EFF, Malema had been expelled as leader of the ANC Youth League.

The EFF's application to intervene on behalf of its leader on Monday was at first dismissed. But when court was reconvened, Judge Gregory Wright withdrew that decision and struck it from the roll instead. He questioned why the party had waited so long to put in the application.

A similar application by the Julius Sello Malema Trust, which raised money for the tax bill, also did not go ahead because it was filed late.

In proceedings over the course of the day, Sars lawyer Nic Maritz submitted that they believed Malema was hiding assets, but he did not have documents to prove it. Sequestration could have helped with this, he said.

Wright had also wanted to know why Malema should be sequestrated if there was a compromise agreement over his tax debt.

''Sars also considered that the Julius Sello Malema Trust had started complying with its tax obligations, including partially paying its outstanding tax debt which was one of the key reasons on which the sequestration application was based on,'' Sars said.

Lebelo said that because Malema withdrew his application for declaratory and interdictory relief, Sars was not bound by the previous compromise agreement and as such could start recovering outstanding taxes. 

Malema has said that he believed the attempt to sequestrate him was politically motivated, as was another case against him in Limpopo.

In that case, Malema, and On-Point Engineering directors, Lesiba Gwangwa and Kagisho Dichabe, and two companies, On-Point Engineering and Gwama Properties, face charges of racketeering and 52 other counts, including fraud.

They are accused of misrepresenting themselves to the Limpopo roads and transport department, leading to a R52m contract being awarded to On-Point Engineering.

Read more on:    eff  |  sars  |  julius malema  |  tax

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