Malema, Mazzotti and Pauw spat - R1m 'crime proceeds' loan claim surfaces

[Gordon_R]

Very lengthy article by Jacques Pauw about Mazzotti, SARS and cigarette taxes: https://www.dailymaverick.co.za/art...tter-of-taxes-fraud-smuggling-and-cigarettes/

Self-confessed cigarette smuggler and EFF benefactor Adriano Mazzotti has admitted to also donating “hundreds of thousands of rand” to the ANC.

 

[Gordon_R]

https://www.dailymaverick.co.za/art...ano-mazottis-home-and-premises-to-pay-taxman/

As you read this, High Court Sheriffs are in the process of attaching and removing all movable property in cigarette baron Adriano Mazzotti's house in Hyde Park, as well as at a warehouse in Kya Sands, in order to pay his company's debt to the taxman. SARS obtained a High Court warrant of execution on 18 February, to attach Mazzotti's movable property to the value of R33,955,228,22. Mazzotti stands accused of being involved in smuggling cigarettes and falsifying documents in an attempt to hide the smuggling. SARS claims Mazzotti owes the taxman R71.9-million in VAT, excise duties and other taxes in this specific case.

N.B. Strangely Mazzotti's name is misspelled in the original article.

 

[R13...]

https://www.dailymaverick.co.za/art...ano-mazottis-home-and-premises-to-pay-taxman/



N.B. Strangely Mazzotti's name is misspelled in the original article.

I'd think he'd owe a lot more than that

 

[Gordon_R]

I'd think he'd owe a lot more than that

That's only one case, there must be more. Due to taxpayer confidentiality we may never know, until it becomes public.

Mazotti is liable for the tax debt in his personal capacity because he is a member of the Close Corporation. He was not home and is, according to his attorney, abroad. His attorney would not comment further and repeated attempts at gaining comment from Mazotti were unsuccessful.

The warrants were obtained by SARS’ newly established Illicit Economy Unit – the taxman’s answer to the investigative capacity former Commissioner Tom Moyane killed in his four year reign since September 2014. The Illicit Economy Unit will broadly focus on syndicated tax and customs tax evasion schemes, including the smuggling of cigarettes.

Various SARS units are investigating further tax schemes relating to Mazotti and his partners as well as Real Time Investments 535 and a second company, Carnilinx.

Edit: Cross-posting, there was some discussion about his tax bill in another thread: https://mybroadband.co.za/forum/thr...g-skyf-is-illegal-survey.992388/post-22533158

 

[Nicodeamus]

My bet is that once the election is over, the NPA is going to have a field day with these lot.

 

[MrGray]

Does anyone find it strange that in the case of Carnilinx (and other large scale smugglers that SARS was investigating when Moyane disbanded or sabotaged the units doing the investigating), there's not a peep about prosecuting these people for the actual illegal smuggling or tax evasion - just an effort to go after the unpaid tax money. Correct me if I'm wrong but illegally smuggling tons of cigarettes is more than just an unpaid tax issue? Why aren't they being actively prosecuted for customs fraud and deliberate tax evasion, etc?

 

[Nicodeamus]

Does anyone find it strange that in the case of Carnilinx (and other large scale smugglers that SARS was investigating when Moyane disbanded or sabotaged the units doing the investigating), there's not a peep about prosecuting these people for the actual illegal smuggling or tax evasion - just an effort to go after the unpaid tax money. Correct me if I'm wrong but illegally smuggling tons of cigarettes is more than just an unpaid tax issue? Why aren't they being actively prosecuted for customs fraud and deliberate tax evasion, etc?

I think that it is obvious by now that there is significant political interference with the NPA. If you and I tried anything close to this then we would be behind bars with the key thrown away.
I do however have a slight optimism that the NPA is preparing their cases and after the election these guys will be nailed, if not then it basically gives the story that crime pays as long as you are politically connected.

 

[Gordon_R]

Does anyone find it strange that in the case of Carnilinx (and other large scale smugglers that SARS was investigating when Moyane disbanded or sabotaged the units doing the investigating), there's not a peep about prosecuting these people for the actual illegal smuggling or tax evasion - just an effort to go after the unpaid tax money. Correct me if I'm wrong but illegally smuggling tons of cigarettes is more than just an unpaid tax issue? Why aren't they being actively prosecuted for customs fraud and deliberate tax evasion, etc?

Your question is answered in the latest article. There is no actual smuggling, it is all VAT related fraud:

Investigations at the Beit Bridge Border Post revealed that the exportation forms “were falsified”. The markings on the forms related to non-related goods being exported, and not the cigarettes as indicated. The clearing agent mentioned on these forms told SARS they had no record of the supposed transactions, and SARS officials said their names and details were “fraudulently used on the documentation”. Real Time Investments 535 could also not prove that the cigarettes were indeed exported to the DRC.

This is one of the most common schemes of smuggling and excise tax evasion on cigarettes – colloquially known as “ghost smuggling”. It allows the smuggler to evade all the taxes payable and push their product into the local market at an extremely low price.

 

[Gordon_R]

I think that it is obvious by now that there is significant political interference with the NPA. If you and I tried anything close to this then we would be behind bars with the key thrown away.
I do however have a slight optimism that the NPA is preparing their cases and after the election these guys will be nailed, if not then it basically gives the story that crime pays as long as you are politically connected.

SARS can hit you much harder than the NPA, which is why Moyane was captured! The threshold for evidence is lower, and there is no presumption of innocence. Since it is not a criminal matter, fewer constitutional issues are involved. The case does not have to spend years in court appeals, and your assets can be seized until the taxes and penalties are settled.

 

[Nicodeamus]

SARS can hit you much harder than the NPA, which is why Moyane was captured! The threshold for evidence is lower, and there is no presumption of innocence. Since it is not a criminal matter, fewer constitutional issues are involved. The case does not have to spend years in court appeals, and your assets can be seized until the taxes and penalties are settled.

I would take your word for it, I am to be honest not too clued up on how the whole prosecuting system works in SA. It does annoy me though that these clowns seem to be getting away with their transgressions.

 

[Gordon_R]

I would take your word for it, I am to be honest not too clued up on how the whole prosecuting system works in SA. It does annoy me though that these clowns seem to be getting away with their transgressions.

You have to go back more than a decade for a successful SARS cigarette smuggling prosecution. It was all dismantled when it got too close to those in power, amidst 'rogue unit' smears by Moyane. See:
https://city-press.news24.com/News/...team-dismantled-anti-corruption-unit-20180926 and
https://www.news24.com/SouthAfrica/News/why-sars-unit-was-targeted-20160917

Sars’ investigation into the tobacco industry followed in 2013, after it began suspecting that 40% of the cigarettes being sold in South Africa were being produced illegally or were smuggled into the country. That means tax losses of between R4 billion and R5 billion every year.

Van Loggerenberg writes that a joint team comprising some of Sars’ most senior and experienced investigators and officials began investigating and conducting inspections. “We also looked at the smaller players – but soon realised that they were only small in relation to what they were declaring to Sars, and big when it came to smuggling,” Van Loggerenberg writes.

“It was then that we realised we had come up against the interests of people with more influence and power than we could dream of in our wildest dreams.”

 

[3WA]

Mazzotti is learning that you can’t get good help these days.

 

[MrGray]

Your question is answered in the latest article. There is no actual smuggling, it is all VAT related fraud:

It's more than just VAT though, they would have been avoiding the excise tax on cigarettes and this is not just a matter of not making payments, it's active fraud, yet there seems to be no hint of criminal prosecution, only tax recovery.

 

[Gordon_R]

Mazzotti is learning that you can’t get good help these days.

I think the 'price' of good help has gone up. Used to be cheap to buy an entire 'state'...

It's more than just VAT though, they would have been avoiding the excise tax on cigarettes and this is not just a matter of not making payments, it's active fraud, yet there seems to be no hint of criminal prosecution, only tax recovery.

Sorry, I meant both VAT and excise tax fraud. I assume the claim includes penalties. Prosecutions may follow, but the threshold of evidence is much higher for criminal cases.

 

[TysonRoux]

I think the 'price' of good help has gone up. Used to be cheap to buy an entire 'state'...



Sorry, I meant both VAT and excise tax fraud. I assume the claim includes penalties. Prosecutions may follow, but the threshold of evidence is much higher for criminal cases.

I'll be pleasantly surprised if the enablers in authority get prosecuted, ......... the untouchable zANC cadres.

Heard any more on this: "EFF leader received a R1 million loan "

 

[Gordon_R]

The wheels are slowly beginning to turn at SARS:

Mboweni backs 'intrusive' investigative capacity at SARS, says agency cannot be toothless tiger | Fin24

"SARS must not be a toothless tiger when dealing with tax evasion and illegitimate trades and financial flows," says the finance minister.

www.fin24.com