Section 1 of the Income Tax Act, 58 of 1962 (the Income Tax Act) and other related Revenue Acts empower the South African Revenue Service (SARS) to administer the Acts and to collect revenue for the government of the Republic of South Africa. Sometimes, in order to assess tax liability and collect revenue, the Commissioner and/or officials of SARS have to make certain representations and undertakings to taxpayers in general through interpretation notes, rulings, and other forms of communication. In certain circumstances, SARS is authorised to withdraw rulings made and at times already acted upon, often to the taxpayer’s detriment. This results in lack of clarity, uncertainty and inconsistency in the application of the law. In order to address this problem, an Advanced Tax Ruling System (ATRS) was introduced. In terms of the ATRS, the issuing of rulings is statutorily regulated and binding on both the taxpayer and SARS when certain conditions provided for in the Income Tax Act are met. The purpose of an ATRS is to promote clarity, consistency, and certainty in respect of the interpretation or application of the provisions of tax laws to which it applies. However, the Commissioner is not obliged to follow a policy or undertaking which is in violation of tax laws. Section 76N(3) provides that the Commissioner may withdraw or modify a binding private ruling, or a binding class ruling retrospectively, if the ruling was made in error; subject to sub paragraphs (a), (b) and (c) thereof. This creates uncertainty as opposed to the intention for which the ATRS was introduced. The critical question is, if the Commissioner timeously informed the taxpayer that he has decided not to honour the undertaking made in a valid binding private ruling, which is still in force to the detriment of the taxpayer, can the taxpayer raise a defence of substantive legitimate expectation? It is argued that the issuing of an ATR is an administrative action subject to judicial review, if, in the opinion of the concerned party, it will have an adverse effect. Further, in the event that the Commissioner informs the taxpayer timeously of the intention to withdraw a valid binding private ruling, which the taxpayer has acted upon to their detriment, can they raise a defence of a practice generally prevailing and/or substantive legitimate expectation? The doctrine of legitimate expectation as a defence was authoritatively accepted as part of the South African administrative law in the landmark case of Administrator Transvaal v Traub. However, Chief Justice Corbett expressly stated in a dictum that the content of the expectation may be substantive or procedural in nature, [but] the protection of that expectation, if found to be legitimate, was exclusively procedural. It is argued that the dictum ignores section 33 of the Constitution which introduced reasonableness as an element of the right to just administrative action, which means that the substance of a decision may be reviewed if it is unreasonable. The objective is to examine whether the courts could develop the doctrine of legitimate expectation beyond the procedural protection, as already done in countries in Europe. Copyright / Dissertation (LLM)--University of Pretoria, 2012. / Mercantile Law / unrestricted

Made available in DSpace on 2016-04-26T20:20:38Z (GMT). No. of bitstreams: 1 Leiner Salmaso Salinas.pdf: 796190 bytes, checksum: 819c4ed2aa9e9e536eb88b2a29d86dba (MD5) Previous issue date: 2011-11-07 / This paper aims to shed light over the effectiveness of the fundamental guarantee upon due process of law within Brazilian Tax Law, as an essential condition to the possibility of exigency of a certain amount as taxes compelled by the Brazilian Federal State. In view of that, we shall do a historical introduction to tax as an instrument of power and its interaction with the State; we shall highlight the constitutional principles importance as essential guarantees to be followed at a Democratic Constitutional State; shall emphasize the enlargement of the due process of law and highlight our tax ruling and assessment act conceptions. We support the thesis that without the due process of law tax power cannot be balanced provided that in a statutory law system, the constitutional guarantees are the main compass of justice sense. Moreover, we understand that disrespecting the enjoyment of the due process of law, whether if in its material or procedural sphere, would lead up to the nullity of tax exigency interposed at the Federal Government Collectible Debt as a severe offense to the 1988 Brazilian Federal Constitution / O presente trabalho tem por escopo trazer a lume a efetividade da garantia fundamental do devido processo legal na aplicação do Direito Tributário, como condição indispensável à possibilidade de exigência de valor a título de tributo forçadamente pelo Estado. Para tanto, fazemos, em suma, uma introdução histórica do tributo como instrumento de poder e sua relação com o Estado; realçamos a importância dos princípios constitucionais como garantias primordiais a serem obedecidas no Estado Democrático de Direito; ressaltamos a amplitude da garantia do devido processo legal; e salientamos nossa concepção de norma jurídica tributária e de ato de lançamento. Defendemos a tese de que, sem obediência ao devido processo legal, inexiste equilíbrio necessário do poder tributário ´, uma vez que, num sistema de direito positivo, as garantias constitucionais são a bússola central do sentimento de justiça. Mais do que isso, sustentamos que o desrespeito à fruição do devido processo legal, seja na faceta material ou processual, acarreta na nulidade de exigência tributária permeada na Dívida Ativa do Estado, por grave ofensa à Constituição Federal de 1988

The European Union was devised to promote competition in the international market environment and ensure balanced allocation of fiscal and political requirements of the Member States. Globalization has led to enabling tax environments through granting of tax benefits by EU Member jurisdictions intended to promote competition in attracting foreign investment, trade, and development. Multinational Corporations may often exploit these tax benefits through various tax arrangement provisions causing a loss of tax revenue. The European Commission is implored to oversee the tax ruling granted by the Member States that is distortionary to the internal market. The Notion of State aid rule Article 107(1) TFEU is adopted as part of the mechanism to combat distortions that leads to tax evasion and harmful tax competition.  This research is intended to analyse the Commission and the General Court’s approach to demonstrate illegal or unlawful State aid through varied and adaptive methodology to tackle emerging complex tax arrangements provisions of Multinational Corporations, notably the Amazon and Engie recent cases. This paper also discusses the identification of potential conflict of laws between the relevant general system of legal rule of the domestic tax legislation and EU Law. Specifically with regards to the determination of whether a tax benefit confers a tax advantage and subsequently if that advantage is deemed selective in nature in a transfer of financial asset undertaking under a certain domestic law. The dynamics of potential abuse of law and aid recovery with the general tax principle of Legality will also be explored.

Jurisdictions around the world currently compete to attract mobile capital of multinational companies by providing them the most favourable tax conditions. Some EU member states actively participate in tax competition. Over the past decade, the European Commission has successfully enacted a number of measures aimed at preventing multinational companies from implementing aggressive tax planning schemes. These measures aim to establish fair conditions for competitors on the internal market and to meet the demand of the public and of the international community for suppression of aggressive tax planning. The theoretical background of the thesis derives from the field of Law and Economics, specifically by using the concept of transaction costs and means of Economic analysis of criminality. This thesis aims to answer the question of whether the new EU legislation leaves room for the member states to continue in allowing multinational companies to optimize taxes in the ways targeted by the EU measures. The thesis consists of two case studies, which evaluate the impact of the rules on known tax optimization schemes. The first one analyses the impact of state aid proceedings on tax rulings and the second one analyses the influence of the controlled foreign company rule on harmful IP boxes. The objective...