South African Finance Minister Pravin Gordhan has just released statistics that would make anyone with an interest in how the rich live drool with envy. It seems they are among the worst tax dodgers.
Gordhan says, for example, 50 individuals who own luxury private planes in excess of R20 million have been identified but they have declared gross income of less than R1 million a year in their tax returns.
Some even own Ferraris but claim to earn less than R350 000 a year.
Below is Gordhan’s full statement released ironically on 1 April, which was Fool’s Day:
Overview on High-Net Worth Individuals
- In the past year SARS has identified approximately 2,800 individuals who meet the criteria set of High net worth individuals ? i.e. earning a Gross income of more than R7 million per year or who have assets in excess of R75 million
- Currently there are only about 360 individuals in this income category registered with SARS
- During the past year SARS has been further investigating the tax compliance levels of some 2 800 individuals and several of them will receive greater scrutiny in the coming year
- As examples, over 50 individuals have been identified who own luxury private planes in excess of R20 million but who have declared gross income of less than R1 million in their tax returns
- Over 1,100 individuals have been identified who own property in excess of R30 million, the majority of whom appear to earn very modest incomes that are not reconcilable with assets registered in their names
- There are also a number of individuals who own luxury cars including Lamborghinis and Ferraris even though they claim to have gross income of less than R350,000 – 00
- During the next financial year, SARS will therefore be focussing its attention on the 200 most non?compliant High-Net Worth individuals.
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