Astron Energy, one of the leading fuel companies in South Africa is embroiled in legal proceedings with the South African Revenue Service (SARS) that relates to a tax assessment of R2.7 billion. The dispute relates to a customs and excise audit that SARS completed between May 2015 and March 2017 before Astron was acquired by commodities giant Glencore.
After the audit, in October 2019 SARS issued a letter of demand, indicating that Astron owed a total of R2,714,001,723.73 in unpaid excise duties and fuel levies including interest and penalties. The tax authority cited serious compliance issues and declined to allow Astron to net the amount owing back with refund claims for taxes overpaid.
Astron Disputes SARS Claims in Court
Astron has robustly challenged the assessment and submitted that the tax assessment is both factually and legally incorrect. The company contends that the tax authority wrongfully denied valid refund claims which could have either greatly reduced or completely eliminated the taxpayer’s total liability.
In order to challenge the demand Astron approached the Western Cape High Court for either a direct appeal or a review under the Promotion of Administrative Justice Act (PAJA). Astron went on to contend that if the initial SARS demand is set aside, the subsequent internal appeal decision should fall away.
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Court Pushes Back Against SARS Delay Tactics
SARS tried to stop the case at an early stage by lodging legal exceptions, claiming Astron had combined legal processes and had not included essential facts in its court papers. Judge Moosa rejected SARS’ exceptions, noting none of SARS’ claimed harm had been proven, much less the loss of billions of rand and suggested SARS was using exceptions as a delaying tactic anyway. He accused SARS of being not brave enough and sitting on its objections for over two years before being forced to act.
The matter now continues, with billions of Rand at stake and both parties firmly entrenched.
