The Tax Consequences of State Capture and Reform Proposals

The Tax Consequences of State Capture and Reform Proposals:

A Submission to the Zondo Commision of Inquiry

AIDC Economic Justice Programme Press Release | 27 May, 2019

Please find here, The Alternative Information and Development Centre’s (AIDC) submission to the Zondo Commission of Inquiry into State Capture. The submission, titled “The Tax Consequences of State Capture and Reform Proposals” drawing from the Nugent Commission of Inquiry, evaluates the consequences and causes of the capture of tax institutions not merely as a matter of bad individuals but as matter of weak institutions.

This submission by the AIDC evaluates the negative impact State Capture had on tax collection in South Africa in relation to declining revenues.  It expose the major flaws of our tax institutions and the legal framework by highlighting the shortcomings of our tax agencies and their oversight mechanisms. The submission also shows why the current tax secrecy paradigm in which South Africa is entangled in has prevented tax authorities, business interests and civil society organizations from playing their role in safeguarding normal tax collection mechanisms.

Finally the submission  proposes the establishment, in steps, of national records accessible both online and in municipal buildings where all South African citizens tax returns will be available. In addition to this, the creation of a public registry of beneficial ownership for all types of companies, land and assets in South Africa.  The publication of Country-by-Country, subsidiary-by-subsidiary reports all large companies operating in South Africa in an easily accessible database.

The submission was authored by Dominic Brown, Head of AIDC’s Economic Justice Programme, and Erwan Malary, former advocacy officer in the AIDC’s Economic Justice Programme, the submission is available online here.

Media inquiries can be directed to Rekang Jankie at rekang@aidc.org.za or alternatively 021 447 5570.