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Court rules against taxpayer abuse of court system

Court rules against taxpayer abuse of court system

Tshwane, 23 September 2021– The South African Revenue Service (SARS) welcomes the judgement in favour of SARS in the vexatious litigation application against Mr Gary van der Merwe and others in the Cape High Court.

It is the first time in SARS’s history that the organisation has brought a vexatious litigation application in opposition to the obstructive behaviour by a taxpayer intended to delay legal proceedings.

Earlier this week, the court found that the legal action by Mr van der Merwe and others posed “a very real risk” of negatively impacting on the court system and the administration of justice and patently amounted to an abuse of the court process.

According to the judgment, Van der Merwe’s action was an extreme example of a taxpayer abusing the court system and making unsubstantiated allegations against SARS of corruption, fraud and harassment.

The implication of this judgement is that Mr van der Merwe may not institute legal proceedings against any person (including SARS) without first obtaining a court’s authority.  The order applies to Mr van der Merwe in his personal capacity and in his capacity as a trustee or director of any company and to the trustees of Eagles Trust.

SARS Commissioner Edward Kieswetter said the legal action by Mr van der Merwe and others over more than ten years was intended to thwart the organization from fulfilling its legislated mandate and to frustrate every effort to bring finality to the matters against him.

“SARS will always provide certainty and clarity to taxpayers to meet their obligations. Where a dispute arises, SARS has systems in place to amicably resolve matters without resorting to litigation. This does not stop taxpayers from exercising their right to seek relief from the courts, if unsatisfied with the outcomes.  However, taxpayers who use the courts to delay and frustrate the collection of taxes will be vigorously opposed.”

The Commissioner expressed the hope that the judgment would deter others from initiating frivolous and vexatious litigation against SARS to stop it from carrying out its core business, which is to collect all revenue due in order to help Government to build a capable state that advances the social and economic development of our country and the well-being of all South Africans.

For further information please contact [email protected]

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