The amaBhungane Centre for Investigative Journalism has given an explosive account of a complex deal sold to embattled tycoon Christo Wiese, which the SA Revenue Service (Sars) views as part of an alleged multibillion-rand “tax evasion” scheme.
Published in the Financial Mail on Thursday, the report details how an executive at Africa’s largest law firm ENSafrica approached Wiese a decade ago to sell him a company as part of an Irish oil firm's restructuring. In the end, the deal may have proven to be a “very sour lemon”.
The report is based on court papers filed in the Western Cape High Court. The case is due to be heard in court next month.
This is the latest blow to Wiese, who has seen his personal fortune shrink by almost R60 billion since the Steinhoff meltdown.
The report details a number of complex transactions that allowed Tullow to sell its African assets to an ENS-controlled firm so that it could reportedly move its tax base to the Netherlands.
ENS designed an “aggressive tax structure” to help the Irish oil company Tullow to shift assets worth R3.9bn out of SA, dodging taxes in the process, Sars contends. Sars is now holding Wiese, a former ENS employee and two others personally liable for the R217m asset they had allegedly "knowingly dissipated … in order to obstruct the collection of tax debt" worth billions.
According to the report, Wiese was approached by a former ENS executive to buy a company connected to the deal from an ENS-controlled trust. The company housed an assessed loss of R198 million, which Wiese’s Titan Premier Investments could potentially used for future tax write-offs.
Wiese told amaBhungane that he received no tax benefit from the scheme, and ENS also denied any tax evasion claims.
"The unstated purpose of Tullow UK was to remove the underlying assets of the taxpayer from SA without paying [capital gains tax] or [secondary tax on companies]," Sars says in court papers. ENS denies this.
Fin24 reports that ENSafrica said on Thursday that it could not provide a detailed response to the article, as it is on record as the attorneys for certain parties in subsequent proceedings.
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