January 6th local time, according to local media reports, the South African National Revenue Service is preparing to tax the overseas assets of the country’s citizens, and some taxpayers have received relevant notices.
According to the report, the days when the South African National Revenue Service turned a blind eye to the overseas assets of the country’s taxpayers.
The Revenue Service has reached an agreement with the relevant agencies in 87 countries to automatically exchange information and finally obtain information about the assets of the country’s taxpayers overseas.
At present, some taxpayers have been notified.
These taxpayers need to declare very detailed overseas asset information to South Africa, including the amount of investment, the nature of the investment and the location of the investment, etc.
In the relevant notice, the South African National Taxation Authority said that the taxpayers who received the notice must reply to the relevant issues within 21 working days and explain the reasons why the relevant information has not been disclosed in the previous tax schedule and whether they are willing to file for tax on the relevant assets in the future.
Failure to respond in time will constitute a criminal offence.
Relevant economists also questioned this.
Some economists said that South Africa’s tax burden (tax to GDP ratio) is the highest among emerging markets, and the heavy tax measures implemented in the past decade have made South Africa the country with the largest change in tax burden between 2009 and 2018.
At the same time, taxing the poor will have a negative impact on the consumption of the poor, and taxing the rich may lead to these people and their money to leave South Africa.
Due to the serious situation of the epidemic, the South African government has repeatedly said that South Africa’s tax revenue and expenditure have formed a huge gap.
In addition to the preparation for the tax on the overseas assets of South African citizens, the South African Ministry of Finance recently said that South Africa plans to impose an additional “solidarity tax” of 40 billion South African rands ($3B) over the next four fiscal years.