Abstract:
Tax evasion is not a new discovery. The concept of cheating the taxman has been around since the time of the Egyptian Pharaohs. Tax evasion and punishment methods in ancient times, specifically in Egypt, Greece and Rome, are discussed and compared to the history of the native poll tax and the evasion thereof in South African during the 18th century. The tax evasion court case of Al Capone in 1931 laid the foundation for methods such as collaboration between tax authorities and law enforcement agents to investigate charges and convict tax evaders in modern day society. The curbing of tax evasion is a hurdle which governments and policy makers struggle to overcome. This study focuses on establishing whether the rules, legislation and policies implemented by the revenue authorities, for this study, South African Revenue Service, are adequate to prevent tax evasion. Evidence from resent court cases in South Africa and interviews with economic crime offenders serving prison sentences indicated that rules, legislation and policies implemented by the South African Revenue Service, detect and combat tax evasion but do not aim to prevent tax evasion. The reason for this is that rules, legislation and policies do not address the motive for economic crimes. Therefore, it is suggested that the South African Revenue Service adopts a holistic approach towards policy design in order to prevent tax evasion.
