South Africa reports progress on tackling trade-based IFFs

Since April 2019, the South African Revenue Service (SARS) has recovered 2.6 billion rand (R2.6 billion – US$179 million) of revenue after unearthing a series of trade-based illicit financial flows (IFFs).

But according to SARS commissioner, Edward Kieswetter, while the revenue service has begun to make headway by establishing a unit focused on IFFs, several agencies working cooperatively will make a more substantial impact on trade-based and other forms of financial crime in South Africa.

Collaboration and funding

SARS has been working with the National Prosecuting Authority (NPA) in a multi-pronged strategy to clamp down on illicit activities.

To support their efforts, the revenue service was allocated R1bn and the NPA received R1.3bn in the budget policy statement issued in October 2019 by finance minister, Tito Mboweni.

Clothing and textiles

The clothing and textile sector has suffered badly from trade-based IFFs and is a key focus area for SARS according to the commissioner.

He says under-declaration of customs value in this sector has increased significantly, from R5.2 billion in 2014 to R8.52 billion in 2018.

Categories: Trade Based Financial crimes News

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