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HEFTY FINES IN PROPOSED TAX BILL

06/11/2020 08:23:00 BY SIBONGILE SUKATI

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MBABANE – Taxpayers better have their ducks in a row as the proposed Tax Administration Bill 2020 comes with certain fines.

The Bill was tabled by the Minister of Finance, Neal Rijkenberg, in the House of Assembly on Wednesday.

Its objective is to define the functions and powers of the Commissioner General (CG) of the Eswatini Revenue Authority (SRA) in the Income Tax Order 1975, Value Added Tax Act 2011 and any other Act as may be prescribed by the minister.

The Bill also seeks to define the right and obligations of the taxpayer.

Penalties

On penalties, offences and administration penalties, Section 53 (1), which speaks on the late return submission, states that a person shall be liable to a maximum penalty of E1 000 per day after the due date.

According to the clause, the person who failed to submit the return on the date as required under any of the Acts administered by the CG shall cease to be in default at the time the CG receives the return.

The Bill is currently with the Ministry of finance House of Assembly Portfolio Committee.

On late payment, the Bill proposes that a person who fails to pay tax on emoluments, provisional tax, VAT or any other amount as required under the Acts administered by the CG, shall be liable to a penalty equal to two per cent of the amount due per month or part thereof.

On non-compliance, the proposed maximum penalty is E50 000. According to Section 55, incidents where a person has been non-compliant may include when a person fails or neglects to register or notify the CG of a change of address.

It could also be when a person refuses to give assistance required for audit or refuses or neglects to refurnish, produce or make available any information, document, electronically stored data or article.

A person could also face a penalty not exceeding E50 000 if the individual refuses or neglects to reply or answer accurately any question put to the person by the authorised officer.

Compliance

On the matter of false returns and statements, Section 56 (6) states that any person who in purported compliance with any requirement of the VAT Act makes a return or other declaration, furnishes any document or information, whether in writing or otherwise, that is false in any material particular, is liable to a penalty which does not exceed E50 000.

The proposed law further states that a person who knowingly or fraudulently uses a false taxpayer identification number or other tax numbers issued by the CG shall be liable on conviction to a fine of not less than E10 000.

That person is also expected to pay the tax due at that time.

Offences

On issues of criminal offences relating to evasion of tax and offences carried a fine not exceeding E100 000 or imprisonment for a term not exceeding 10 years.

The offences under tax evasion may include cases where a person omits from a return any income which should under the Bill be included therein. Another offence could be when a person uses a false taxpayer compliance certificate purported to be issued by the CG and also makes any fraudulent claim for the refund or recovery of any tax.

“A person who makes any false statement or entry in any return, gives any false answer, whether verbally or in writing to any question, commits an offence and shall be liable on conviction, in addition to payment of tax due, to a fine not exceeding E100 000,” reads Section 62 of the Bill. Section 62 (1)(g) states that any person who deals in or accepts the supply or importation of any goods or the supply of services having reason to believe that the proper tax has not been or will not be paid or that any deduction or credit has been falsely claimed, commits an offence.

In this regard, the goods which are the subject of the offence shall, if the court convicts and so orders, be forfeited. On the filing of returns without authority, the Bill criminalises an act where a person submits a return or other documents to the CG under a forged signature. This offence, upon conviction, is liable to a fine of not less than E5 000 or to imprisonment for a period not exceeding three years.

Publish

On another note, the Bill states that the CG may from time to time publish for general information the particulars of offenders relating to a tax offence committed by the person if the person was convicted of the offence.

The publication may specify the name and area of residence of the offender, any particulars of the offence that the CG thinks fit and the particulars of a fine or sentence imposed.