The tax evasion punishment system in South Africa

Abstract

Schemes to outsmart the revenue authority and circumvent the burden of paying taxes have been around since the early ages. Governments implement systems to combat and curb tax evasion, expecting that their punishment methods will deter people from evading tax; nevertheless, tax evasion remains a big concern. To develop effective and appropriate punishment methods to deter tax evasion, taxpayers and their perceptions of tax evasion should be considered. This article explores the tax evasion punishment methods in South Africa, with the aim of answering the research question: to what extent do the tax evasion punishment methods in South Africa deter tax evasion?

A mixed-method research design was selected for this study. It includes data collection via questionnaires given to taxpayers and registered tax practitioners in South Africa and interviews with six expert role players in South Africa’s tax evasion punishment system. The participants’ perceptions of the appropriateness of the current tax evasion punishment methods in South Africa were explored along with taxpayers’ tax evasion behaviour.