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The SA Revenue Service (SARS) has announced that it is fighting to reclaim tens of billions of Rand lost in an eight-year scam involving dozens of firms and a complex gold-selling scheme.
How was the taxman scammed out of R24 billion?
The researchers at investigative unit amaBhungane managed to uncovered the murky details of this sinister plot, and exposed the grifters who had managed to take the state for a ride. A complex system of smelting, tax avoidance, and refund claims saw the gold-shifting ring take almost $2 billion from the government.
The details behind the scam are mind-boggling…
- Between 2012 and 2020, the scammers scammed the taxman for R24.4 billion ($1.8 billion dollars).
- A total of 65 companies are implicated over the eight-year period.
- They defrauded the tax system: The sale of gold carries a tax, but the sale of gold exports DO NOT.
- In the scam, companies illegally smelted gold coins and old jewelry into gold bars for export.
- These companies then created fake invoices, to claim that they had paid tax on the sales.
- When the gold was exported at zero tax, they submitted the invoices to SARS, claiming billions in fraudulent refunds.
Gold scam: How tricksters managed to stitch-up SARS
However, SARS has finally caught up with these rogue traders, and the long arm of the law is set to reign-in a number of these gold-selling kingpins – who operated on a scarcely believable scale.
Estimates from SARS suggest that just two companies from the 65 implicated were, at one point, able to sell the equivalent of ‘70% of all gold legally mined in South Africa’. The investigation into this scheme remains active.
“In 2019, the scheme allegedly involved amounts of gold equal to an astonishing 70% of all gold legally mined in South Africa in that year – and that’s only counting the activities of the two most active players.”