EXCLUSIVE: Corporates leave R7bn tax hole in SA
Some of the biggest multinational firms that are coining it in SA appear to be transferring a substantial portion of their gains to their parent companies in tax havens. But there are ways to combat this
Two groundbreaking research papers on corporate tax avoidance in SA have found that the authorities have grossly underestimated the scale of unlawful profit shifting out of the country. It conservatively amounts to R7bn a year in foregone taxes, and some of the largest multinationals are the biggest culprits. The working papers, both authored by Ludvig Wier, a doctoral fellow at the University of Copenhagen, are among the first to emerge from a new research programme, SA-Tied. It is a tie-up of the National Treasury and other economic cluster ministries with several international research institutions, including the UN University World Institute for Development Economics Research. The crux of the outcome has been the creation of a high-quality, anonymised tax information database on companies and individuals operating in SA that is enabling the authorities to gain fresh insights into the workings of the economy — and the way to close tax loopholes. The two studies are the first to e...
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