Lucrative taxi industry evades tax, but demands government subsidies, says DA

Finance Minister, Tito Mboweni: File Pic: GCIS

Despite the taxi industry’s demands for government subsidies, South Africa’s government still collects about R5 million from the industry.

In reply to the Democratic Alliance’s parliament question, Finance Minister Tito Mboweni has revealed that the industry pays R5 million a year in tax.

Responding to Mboweni, DA Shadow Minister of Finance, Geordin Hill-Lewis calls on the South African Revenue Services (SARS) to act against taxi tax dodgers.

Hill-Lewis said that SARS must make sure that the industry pays its fair share.

The report stated that the industry generated annual revenues of R90-billion.

The DA said it will ask the SARS to brief parliament on its plans to crack down on tax evaders.

“Now that the tax evasion has been confirmed, we can expect the agency to step up its efforts to bring those who evaded taxes to book,” said Hill- Lewis.

Hill- Lewis warned that under-declaration and evasion of taxes are both illegal acts that carry a prison sentence of up to two years.

“It is unfair to the law-abiding members of the public who are responsible for their taxes. It undermines tax morality in the whole country,” said Hill-Lewis.

In his reply, Mboweni said he has initiated a number of actions to address the problem, but none of these are enforcement actions.

“We cannot fix the state, or repair government finances if entire profitable industries just boycott paying tax. This sets a dangerous precedent for the future. We call on SARS to brief Parliament as soon as possible,” added Hill-Lewis.

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