Florida businessman to serve 15 years in prison following fraud sentencing
Goldman Street builder was found guilty on three counts relating to fraudulent tax returns.
The Johannesburg Specialised Commercial Crimes Court handed down a sentence of a man convicted of defrauding the South African Revenue Service (SARS) on August 2.
Anwar Gaffor ran Ceiling and Partitioner Installers in Goldman Street and was found guilty of submitting fictitious Value Added Tax (VAT) 201 returns to SARS. Having done so from September 2019, the court stated that Gaffor had unduly benefitted from VAT refunds worth over R2.9 million. The 41-year-old was subsequently charged and found guilty of three counts of fraud.
The court sentenced Gaffor to 45 years of direct imprisonment for the three counts but ordered that the sentences imposed on counts two and three must run concurrently with the sentence on count one. The result will be an effective imprisonment term of 15 years. Elaborating on his actions, the court stated that Gaffor used false or fictitious tax invoices that were purported to be from different entities to substantiate or support the claims for VAT refunds.
Any person who manages an enterprise is compelled under certain conditions to register for VAT with SARS. Once registered, the entity is then referred to as a VAT vendor. As such, VAT must be collected from suppliers of goods and services and this is referred to as Output Tax.
A VAT vendor is also able to deduct VAT on a variety of expenses, including capital and operating costs. This is referred to as Input Tax, as long as the amounts are necessary to advance the business and are permitted under the VAT Act. Every second month, the vendor must submit VAT returns, referred to as VAT 201, to SARS accounting for both Output and Input Tax. SARS relies on the integrity and honesty of each VAT vendor when it comes to administering the amount payable to SARS or refundable to VAT vendors.
“The National Prosecuting Authority (NPA) commends Advocate Lebohang Jobo and the investigating officer Constable Phesheni for ensuring that the accused faces the might of the law for abusing the confidence SARS entrusted in him as a VAT vendor and hopes that the sentence given will dissuade people from evading tax liability through criminal conduct,” said NPA Regional Spokesperson for the Gauteng Local Division Phindi Mjonondwane.
“SARS Commissioner Edward Kieswetter expressed his appreciation to the NPA and the criminal investigation team within SARS for their cooperation that led to this excellent outcome,” Mjonondwane concluded.
The NPA added that taxpayers who willfully transact with SARS with criminal intent will be relentlessly pursued by the tax-collecting organisation.
