Sars targets 52 'non-compliant' companies that scored R1bn in PPE and Covid-19 related contracts

08 October 2021 - 19:25
Sars has recovered R170-million in unpaid taxes linked to PPE contracts.Stock photo.
Sars has recovered R170-million in unpaid taxes linked to PPE contracts.Stock photo.
Image: 123RF/Olivier Le Moal

The SA Revenue Service (Sars) has targeted 52 non-compliant companies that received R1bn in contracts for the supply of personal protective equipment (PPE) and other Covid-19 related services.

Eleven companies have been convicted to date, seven cases are on the court roll, 29 cases are with the National Prosecution Authority (NPA) for the drafting of charge sheets or warrants of arrest, while five case dockets are being processed by the Hawks.

“Sars has recovered R170m in unpaid taxes linked to PPE contracts and R500m in assets [including cash] are under preservation orders. Sars is also investigating 33 entities linked to politically exposed persons.

“In addition, several companies that received government tenders totalling R50m for Covid-19 related services were recently sentenced for not registering for VAT.

“The companies were awarded tenders for decontamination and deep cleansing of schools by the Gauteng department of education. Another company was awarded a tender by the KwaZulu-Natal department of social development for provision of hygiene equipment and consumables,” said Sars.

The companies were convicted and sentenced in the Durban district court last week. The sentences range from five months to 10 months' imprisonment (with the option of a fine). The cases follow similar convictions in Gauteng and the Free State.

Sars commissioner Edward Kieswetter said it seemed some companies were operating outside the law, seeking to profit from a devastating pandemic that had affected the lives and livelihoods of millions of South Africans, especially the poor and vulnerable.

“Sadly, most of the looted funds are being used to finance lavish lifestyles,” he said.