Court Grants SARS Preservation Order and Search Warrant in Tax Evasion Case

SARS Commissioner Edward Kieswetter lauded the ruling as a significant development in addressing criminal activity that undermines the South African economy.

The KwaZulu-Natal Local Division of the Durban High Court has granted a preservation order and search-and-seizure warrant against businesswoman Shauwn Mkhize and others, marking a critical step in the South African Revenue Service's (SARS) intensified efforts to combat tax evasion and uphold the integrity of the country’s tax system.

SARS Commissioner Edward Kieswetter lauded the ruling as a significant development in addressing criminal activity that undermines the South African economy. "This decision underscores SARS’s commitment to making tax evasion increasingly hard and costly for those who engage in it wilfully and intentionally," Kieswetter said.

Focus on the Construction Sector

SARS highlighted its ongoing focus on ensuring tax compliance within the construction industry, which has been under scrutiny for several years. This latest enforcement action, executed in collaboration with the South African Police Service (SAPS) and the Hawks, is part of a broader strategy to enforce provisions of the Tax Administration Act No. 28 of 2011. The preservation order and search warrant were issued under Section 163 of the Act, which aims to secure assets and prevent their dissipation, ensuring the collection of taxes and preserving evidence of potential non-compliance.

Strengthened Enforcement Measures

SARS emphasized that the orders were essential to prevent individuals from hiding or transferring assets that could frustrate tax collection efforts. The action also reflects SARS’s broader strategy of ensuring that no taxpayer, regardless of social or economic standing, escapes their obligations.

Commissioner Kieswetter expressed gratitude to law enforcement agencies, commending their cooperation under challenging conditions. “This operation sends a clear message: lawlessness will not be tolerated. The most vulnerable in society, including the aged and children, rely on taxes to alleviate poverty, unemployment, and hunger. Those who wilfully defy the law undermine these efforts and will face the consequences,” Kieswetter stated.

Implications for High-Profile Individuals

The case against Mkhize, a well-known public figure and businesswoman, underscores SARS’s commitment to ensuring accountability, even among high-profile individuals. Kieswetter reiterated that "no one is above the law," emphasizing SARS’s mandate to act without fear, favour, or prejudice.

Ongoing Crackdown on Tax Evasion

This latest action is part of SARS’s broader campaign to address tax non-compliance across various sectors. Recent reports indicate that SARS has also targeted businesses and individuals involved in construction, a sector often plagued by underreporting of income, unregistered businesses, and misuse of VAT returns.

Looking Ahead

SARS plans to intensify its collaboration with law enforcement agencies to strengthen investigations and enforcement. The agency has signalled that additional high-profile cases may emerge as it continues its crackdown on tax-related criminal activities.

The preservation order granted by the court ensures that assets linked to non-compliance will be secured and made available for tax collection, providing a powerful deterrent against similar offences in the future.