RSA vs Wiese & Others: TAX DEBT RECOVERY CASE

Case Information:

Court: The Supreme Court of Appeal of South Africa
Case No: 1307/2022
Applicant: Christoffel Hendrik Wiese and Others
Defendant: Commissioner for the South African Revenue ServiceThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently...
Judgment Date: 12 July 2024

Judgment Summary

The Supreme Court of Appeal of South Africa (SCA) dismissed the appeal by Christoffel Hendrik Wiese and others in their dispute with SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... over the recovery of a tax debtTax liability represents the total amount of tax owed by an individual or business to a tax authority, whether local, national, or international. This obligation arises through various forms of income, profits, or transactions subject to taxation laws and regulations. Understanding tax liability is essential for compliance and efficient financial management for corporations and individuals. It influences how businesses structure.... The appellants had challenged SARS’s interpretation and application of section 183 of the Tax AdministrationTax authorities are fundamental institutions within government frameworks, overseeing tax assessment, collection, and administration. Their operations ensure that tax laws are enforced and public funds are collected efficiently. This article delves into tax authorities' purpose, responsibilities, and structure, offering insights into their essential role in supporting government functions and economic stability. What is a Tax Authority? A tax authority is... Act (TAA), which imposes liability on third parties who knowingly assist in dissipating a taxpayer’s assets to obstruct tax collection.

The case arose from a 2007 restructuring by Energy Africa, which triggered potential liabilities for capital gains taxCapital Gains Tax (CGT) is a tax imposed on the profit an individual or entity earns from the sale or disposal of a capital asset. This tax is not levied on the total sale price of the asset but rather on the capital gain, which is the difference between the asset’s acquisition cost (or “base cost”) and its sale price.... (CGTCapital Gains Tax (CGT) is a tax imposed on the profit an individual or entity earns from the sale or disposal of a capital asset. This tax is not levied on the total sale price of the asset but rather on the capital gain, which is the difference between the asset’s acquisition cost (or “base cost”) and its sale price....) and secondary tax on companies (STC). Before assessments were issued, Energy Africa transferred its only valuable asset—a loan account worth R216.6 million—as a dividend in specie, rendering itself insolvent. SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... argued this action was intended to evade paying taxes.

The appeal centered on two questions:

Whether a “tax debt” must be assessed and due at the time of asset dissipation under section 183.
Whether evidence obtained during a section 50 inquiry under the TAA was admissible in subsequent proceedings.

The court held that tax debts arise upon the occurrence of a taxable event, independent of assessment. Assessments merely confirm and quantify pre-existing liabilities. It also ruled that section 56(4) of the TAA allows evidence from inquiries to be used in subsequent proceedings, subject to safeguards.

The judgment reaffirms SARS’s enforcement powers, clarifies the scope of third-party liability, and underscores the importance of proactive compliance by taxpayers and associated parties.

Key Points of the Judgment

1. Background

The dispute originated from a 2007 restructuring transaction involving Energy Africa, which sold a subsidiary to a connected party, triggering potential tax liabilities for CGTCapital Gains Tax (CGT) is a tax imposed on the profit an individual or entity earns from the sale or disposal of a capital asset. This tax is not levied on the total sale price of the asset but rather on the capital gain, which is the difference between the asset’s acquisition cost (or “base cost”) and its sale price.... and STC. However, Energy Africa did not declare these liabilities in its returns. A subsequent SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... audit identified discrepancies, and in 2012, SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... issued revised assessments for CGTCapital Gains Tax (CGT) is a tax imposed on the profit an individual or entity earns from the sale or disposal of a capital asset. This tax is not levied on the total sale price of the asset but rather on the capital gain, which is the difference between the asset’s acquisition cost (or “base cost”) and its sale price.... (R453 million) and STC (R487 million), including penalties.

Before these assessments were finalized, Energy Africa transferred its sole valuable asset—a loan account worth R216.6 million—to its parent company as a dividend in specie, effectively leaving no assets to satisfy the potential liabilities. The company was liquidated shortly after.

2. Core Dispute

The central issue was whether a “tax debt” under section 183 of the TAA requires an assessed liability at the time of the alleged asset dissipation. The appellants argued that no tax debtTax liability represents the total amount of tax owed by an individual or business to a tax authority, whether local, national, or international. This obligation arises through various forms of income, profits, or transactions subject to taxation laws and regulations. Understanding tax liability is essential for compliance and efficient financial management for corporations and individuals. It influences how businesses structure... could exist without an assessment, contending that liability arose only after SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... issued the assessments.

SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... countered that tax liabilityTax liability represents the total amount of tax owed by an individual or business to a tax authority, whether local, national, or international. This obligation arises through various forms of income, profits, or transactions subject to taxation laws and regulations. Understanding tax liability is essential for compliance and efficient financial management for corporations and individuals. It influences how businesses structure... arises upon the occurrence of a taxable event, such as the sale of a subsidiary or the declaration of a dividend, and that assessments merely quantify and confirm pre-existing obligations. SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... maintained that allowing third parties to escape liability based on assessment timing would defeat the purpose of section 183.

Additionally, the appellants challenged the admissibility of evidence obtained during a section 50 inquiry, arguing it breached confidentiality provisions and procedural fairness. SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... argued that section 56(4) expressly permits the use of such evidence in civil proceedings.

3. Court Findings

The SCA ruled in SARS’s favour, concluding that:

Tax liabilities arise by operation of law upon a taxable event, independent of assessment. Assessments only quantify and confirm liabilities, making them enforceable.
Section 183’s reference to “tax debtTax liability represents the total amount of tax owed by an individual or business to a tax authority, whether local, national, or international. This obligation arises through various forms of income, profits, or transactions subject to taxation laws and regulations. Understanding tax liability is essential for compliance and efficient financial management for corporations and individuals. It influences how businesses structure...” encompasses liabilities triggered by taxable events, regardless of whether they have been formally assessed at the time of dissipation.

The court emphasized that requiring assessed liabilities at the time of dissipation would undermine section 183’s purpose, allowing third parties to obstruct tax recovery with impunity.

Regarding evidence admissibility, the court held that section 56(4) of the TAA explicitly permits SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... to use inquiry evidence in subsequent proceedings, provided safeguards are observed. It rejected the appellants’ argument that this violated confidentiality provisions, noting that the TAA allows limited disclosure under specific circumstances.

4. Outcome

The Supreme Court of Appeal (SCA) dismissed the appeal, reaffirming SARS’s ability to recover tax debts from third parties who knowingly assist in asset dissipation to obstruct tax collection. The court clarified that tax liabilities arise upon the occurrence of taxable events, independent of the issuance of assessments. It emphasized that assessments merely confirm and quantify pre-existing obligations, making them enforceable but not creating the underlying liability.

The court validated SARS’s interpretation of section 183 of the TAA, concluding that it applies to anticipated tax debts that arise from taxable events, even if assessments are issued after the dissipation of assets. This decision strengthens SARS’s enforcement tools, ensuring that third parties cannot evade liability by timing asset transfers to precede assessments. The judgment aligns with the broader purpose of the TAA to safeguard tax revenueTax Revenue is the income collected by governments through various taxes imposed on individuals, corporations, and transactions. It is a primary source of funding for public expenditures, including infrastructure, healthcare, education, and social services. Tax revenue can come from different types of taxes, such as income tax, corporate tax, value-added tax (VAT), excise duties, and customs tariffs. The level and... and prevent evasion strategies.

On the question of evidence admissibility, the court upheld the high court’s ruling that transcripts from section 50 inquiries are admissible in subsequent proceedings under section 56(4) of the TAA. The SCA noted that confidentiality provisions are not absolute and allow for limited disclosure when necessary for enforcement actions. This reinforces the importance of transparency in tax administrationTax authorities are fundamental institutions within government frameworks, overseeing tax assessment, collection, and administration. Their operations ensure that tax laws are enforced and public funds are collected efficiently. This article delves into tax authorities' purpose, responsibilities, and structure, offering insights into their essential role in supporting government functions and economic stability. What is a Tax Authority? A tax authority is... while balancing taxpayer rights with SARS’s mandate to collect taxes.

Costs were awarded to SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently..., including the costs of two counsel, highlighting the complexity and significance of the issues at stake. This ruling not only clarifies the application of section 183 but also sets a precedent for holding third parties accountable for actions that obstruct tax complianceTax Compliance refers to the adherence of individuals and businesses to the tax laws and regulations of a specific jurisdiction. It encompasses the timely and accurate filing of tax returns, the payment of tax liabilities, and ensuring that all tax-related obligations are met as stipulated by legislation. Compliance involves more than just submitting tax forms; it includes maintaining accurate financial....

Major Issues or Areas of Contention

Timing of Tax DebtTax liability represents the total amount of tax owed by an individual or business to a tax authority, whether local, national, or international. This obligation arises through various forms of income, profits, or transactions subject to taxation laws and regulations. Understanding tax liability is essential for compliance and efficient financial management for corporations and individuals. It influences how businesses structure...
A primary contention was whether section 183 of the TAA requires a tax debtTax liability represents the total amount of tax owed by an individual or business to a tax authority, whether local, national, or international. This obligation arises through various forms of income, profits, or transactions subject to taxation laws and regulations. Understanding tax liability is essential for compliance and efficient financial management for corporations and individuals. It influences how businesses structure... to be assessed and due at the time of asset dissipation. The appellants argued that no tax debtTax liability represents the total amount of tax owed by an individual or business to a tax authority, whether local, national, or international. This obligation arises through various forms of income, profits, or transactions subject to taxation laws and regulations. Understanding tax liability is essential for compliance and efficient financial management for corporations and individuals. It influences how businesses structure... existed when Energy Africa transferred its sole asset, as assessments were issued later. They claimed that without an assessed liability, section 183 could not impose third-party liability. SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... countered that tax debts arise from taxable events, such as asset sales or dividend declarations, and assessments only quantify these pre-existing liabilities.
Admissibility of Inquiry Evidence
The appellants challenged the use of transcripts from a section 50 inquiry in court, arguing that such evidence violated confidentiality and fairness provisions under the TAA. They asserted that allowing SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... to use this evidence in subsequent civil proceedings undermined taxpayer rights. The court rejected this argument, holding that section 56(4) permits such use, provided constitutional safeguards are observed.
Retrospective Liability
The appellants raised concerns about the retrospective application of section 183, claiming it exposed third parties to liability for actions taken without knowledge of a pending assessment. They argued this interpretation created legal uncertainty and placed an undue burden on third parties involved in transactions with taxpayers. The court dismissed these concerns, emphasizing that liability under section 183 applies only when third parties knowingly assist in asset dissipation with the intent to obstruct tax recovery.

Was This Decision Expected or Controversial?

The decision was expected in light of SARS’s longstanding approach to tax enforcement and the purposive interpretation of the TAA. The court’s ruling aligns with established principles that tax liabilityTax liability represents the total amount of tax owed by an individual or business to a tax authority, whether local, national, or international. This obligation arises through various forms of income, profits, or transactions subject to taxation laws and regulations. Understanding tax liability is essential for compliance and efficient financial management for corporations and individuals. It influences how businesses structure... arises from taxable events rather than assessments, supporting SARS’s ability to pursue retrospective claims.

However, the judgment is not without controversy. By affirming the broad application of section 183, the court effectively places significant accountability on third parties involved in transactions with taxpayers. Critics argue that this creates legal uncertainty for third parties who may lack full knowledge of a taxpayer’s liabilities or intentions. The retrospective nature of liability under section 183 could expose innocent parties to risks, particularly in complex, high-value transactions.

Additionally, the court’s validation of section 50 inquiry evidence in subsequent proceedings raises questions about the balance between taxpayer confidentiality and SARS’s enforcement powers. While the decision strengthens SARS’s investigative and enforcement toolkit, it may be viewed as encroaching on taxpayer rights and procedural fairness.

Despite these concerns, the ruling underscores the importance of robust compliance frameworks for taxpayers and third parties alike. By holding third parties accountable, the court aims to deter asset dissipation strategies designed to evade tax obligations. For SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently..., the judgment enhances its ability to secure tax revenueTax Revenue is the income collected by governments through various taxes imposed on individuals, corporations, and transactions. It is a primary source of funding for public expenditures, including infrastructure, healthcare, education, and social services. Tax revenue can come from different types of taxes, such as income tax, corporate tax, value-added tax (VAT), excise duties, and customs tariffs. The level and..., making it a significant but contentious precedent in South African tax lawTax laws form the backbone of any nation’s revenue system, setting the rules that govern how individuals and corporations contribute financially to support government functions. These laws define the types of taxes, the applicable rates, and the regulations regarding payment and compliance. They also outline the rights and obligations of taxpayers, ensuring a balanced and fair approach to funding public....

Significance for Multinationals

For multinationals, this case highlights the critical importance of maintaining robust tax complianceTax Compliance refers to the adherence of individuals and businesses to the tax laws and regulations of a specific jurisdiction. It encompasses the timely and accurate filing of tax returns, the payment of tax liabilities, and ensuring that all tax-related obligations are met as stipulated by legislation. Compliance involves more than just submitting tax forms; it includes maintaining accurate financial... frameworks and monitoring the tax implications of corporate transactions. Tax liabilities can arise upon the occurrence of taxable events, such as restructuring or the declaration of dividends, even if formal assessments are issued later. This ruling places additional scrutiny on the timing and structuring of transactions to ensure they do not inadvertently create exposure under section 183.

Proactive measures, such as detailed transaction documentation, clear intercompany agreementsIntercompany Agreements (ICAs) are legally binding contracts between two or more entities within the same corporate group. These agreements outline the terms and conditions of transactions such as the sale of goods, provision of services, use of intellectual property, or intercompany financing. ICAs are crucial for managing transfer pricing compliance, mitigating tax risk, and demonstrating that intercompany transactions are conducted..., and early engagement with tax authorities, are essential. These steps can help multinationals identify potential liabilities and address them before they escalate into disputes. Internal oversight mechanisms, including tax steering committees, can ensure compliance with local tax lawsTax laws form the backbone of any nation’s revenue system, setting the rules that govern how individuals and corporations contribute financially to support government functions. These laws define the types of taxes, the applicable rates, and the regulations regarding payment and compliance. They also outline the rights and obligations of taxpayers, ensuring a balanced and fair approach to funding public... and safeguard against unintentional breaches.

The judgment also emphasizes the need for multinationals to assess the actions of their subsidiaries and associated third parties. A failure to monitor such activities could result in liability under section 183 for actions deemed to obstruct tax recovery. By fostering a culture of transparency and cooperation with tax authorities, multinationals can reduce the risk of disputes and associated penalties.

This case serves as a warning that SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... and other revenue authorities are willing to pursue aggressive enforcement strategies. Multinationals must prioritize tax risk managementTax risk management is a structured process used by organizations, particularly multinational enterprises (MNEs), to identify, assess, and mitigate potential risks that arise in relation to tax compliance, reporting, and planning. It plays a crucial role in ensuring that a company’s tax obligations are managed in a way that minimizes risk exposure while maximizing efficiency and strategic value. to mitigate financial and reputational risks, especially in jurisdictions with complex tax regimes like South Africa.

Significance for Revenue Services

The judgment significantly enhances the enforcement powers of revenue services, particularly in combating tax evasionTax Evasion refers to illegal activities or practices undertaken by individuals or businesses to avoid paying taxes. It involves intentionally misrepresenting or concealing income, inflating deductions, or underreporting earnings to reduce tax liability unlawfully. Unlike tax avoidance, which uses legal methods to minimize tax obligations, tax evasion is a criminal offence that carries significant penalties, including fines, imprisonment, and asset... through asset dissipation. By clarifying that tax liabilities arise from taxable events rather than assessments, the court has strengthened SARS’s ability to act retrospectively and hold third parties accountable under section 183 of the TAA.

This decision deters taxpayers and third parties from engaging in strategies designed to obstruct tax recovery. By imposing liability on those who knowingly assist in asset dissipation, the judgment reinforces the importance of maintaining transparency and compliance during transactions. SARS’s ability to use section 50 inquiry evidence in subsequent proceedings further bolsters its investigative capabilities, enabling it to uncover and address complex tax evasionTax Evasion refers to illegal activities or practices undertaken by individuals or businesses to avoid paying taxes. It involves intentionally misrepresenting or concealing income, inflating deductions, or underreporting earnings to reduce tax liability unlawfully. Unlike tax avoidance, which uses legal methods to minimize tax obligations, tax evasion is a criminal offence that carries significant penalties, including fines, imprisonment, and asset... schemes.

For revenue services, the ruling provides a precedent to pursue similar cases and recover revenue that might otherwise be lost. It also sends a clear message that tax complianceTax Compliance refers to the adherence of individuals and businesses to the tax laws and regulations of a specific jurisdiction. It encompasses the timely and accurate filing of tax returns, the payment of tax liabilities, and ensuring that all tax-related obligations are met as stipulated by legislation. Compliance involves more than just submitting tax forms; it includes maintaining accurate financial... is non-negotiable and that evasion, whether direct or facilitated by third parties, will be met with stringent enforcement measures.

The case underscores the need for revenue authorities to maintain robust investigative frameworks and legal expertise to address evolving tax avoidanceTax avoidance refers to the practice of legally structuring financial activities to minimise tax liability, reducing the amount of tax owed without violating laws. Unlike tax evasion, which is illegal and involves concealing income or misreporting, tax avoidance operates within the framework of the law. Multinational enterprises (MNEs) and individuals often engage in tax planning strategies that reduce tax liabilities... strategies. By leveraging tools like section 183, SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... can enhance its efficiency in securing tax revenueTax Revenue is the income collected by governments through various taxes imposed on individuals, corporations, and transactions. It is a primary source of funding for public expenditures, including infrastructure, healthcare, education, and social services. Tax revenue can come from different types of taxes, such as income tax, corporate tax, value-added tax (VAT), excise duties, and customs tariffs. The level and..., contributing to fiscal sustainability.

Similar Cases for Review

Singh v Commissioner for SARS

This case relates to Wiese v CSARS by establishing that tax liabilities arise upon the occurrence of taxable events, not upon the issuance of assessments. It supports the principle in Wiese that a “tax debt” exists as a legal obligation regardless of whether it has been quantified through assessment. Singh clarified that liabilities can be enforceable even if under dispute, aligning with the retrospective nature of liability in Wiese. The decision in Singh bolstered SARS’s argument in Wiese that section 183 applies to anticipated tax debts. Both cases underline the distinction between liability and the procedural step of assessment.

Commissioner for SARS v Medtronic

The Medtronic case clarified that tax assessmentsA tax assessment is a formal determination made by a tax authority to calculate the amount of tax an individual or entity owes. It is a comprehensive evaluation based on financial records, declared income, expenses, deductions, and any applicable tax laws or regulations. Tax assessments may arise from routine self-assessments by taxpayers, or they may be conducted by revenue authorities... merely confirm and quantify pre-existing liabilities, echoing the ruling in Wiese that liabilities arise from taxable events. It reinforced the principle that assessments are not required for liabilities to be enforceable, directly supporting SARS’s interpretation of section 183 in Wiese. Medtronic also upheld the retrospective application of tax liabilities, a key element in Wiese. Both cases highlight SARS’s broad powers to recover tax debts, even when they are quantified after the taxable event. Together, they emphasize the proactive responsibilities of taxpayers and third parties in managing tax obligations.

Namex v Commissioner for SARS

Namex emphasized SARS’s ability to recover liabilities that predate formal assessments, directly aligning with the findings in Wiese. It clarified that the issuance of an assessment is not necessary for the existence of a tax debtTax liability represents the total amount of tax owed by an individual or business to a tax authority, whether local, national, or international. This obligation arises through various forms of income, profits, or transactions subject to taxation laws and regulations. Understanding tax liability is essential for compliance and efficient financial management for corporations and individuals. It influences how businesses structure..., reinforcing SARS’s argument that liabilities arise by law upon taxable events. The case validated the principle that liability is triggered independently of administrative procedures, as applied in Wiese. Both cases address SARS’s enforcement mechanisms and the responsibilities of taxpayers to meet obligations even before assessments are finalized. They also demonstrate the statutory preference SARSThe South African Revenue Service (SARS) is the official tax authority responsible for the administration and enforcement of tax laws in South Africa. It plays a crucial role in managing the country’s fiscal policy by collecting revenue, administering customs, and ensuring compliance with tax legislation. Established under the South African Revenue Service Act, No. 34 of 1997, SARS functions independently... holds in recovering unpaid tax debts.