The government has set its sights firmly on religious organizations and their leaders, who are apparently avoiding paying tax.
Finance Minister Tito Mboweni says they can no longer afford to sit back and watch the controversial “Men of the Cloth” flaunt their wealth while finding creative ways of evading tax.
“They get to a point where they indulge in pure luxury. I see no reason why they shouldn’t pay tax,” said Tax Ombudsman Judge Bernard Ngoepe.
A 2017 report on the commercialization of churches in South Africa revealed that religion is a big business.
The report recommends that SARS, in partnership with the Commission for the Promotion and Protection of the Rights of Cultural‚ Religious and Linguistic Communities, conducts a thorough investigation into tax evasion by religious leaders.
Churches are classified as public benefit organizations, so they’re exempt from paying income tax.
However, they’re obliged by law to register their employees, including pastors, for pay-as-you-earn.
“The focus here is understanding where did those assets come from. Is there an abuse, is the right taxes being paid and if concessions are being used, are they used correctly and being abused,” said Tax and Corporate Law Specialist Ettienne Retief. SARS is now increasing the number of assessments of their audit work on public benefit organizations, like churches.
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Source: eNCA
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