Tax: Delays in the ETCS

Any entity doing business with a state institution requires a Tax Clearance Certificate (TCC) from SARS. The TCC confirms that all of the tax affairs of the business are up to date and in order.

To curb abuses in the supply chain management system, government decided to introduce an Electronic Tax Compliance System (ETCS) whereby government officials could check on an entity’s tax status. The system involved a PIN code being issued to the requisite government officer whereby entering the PIN would electronically display the entity’s tax status in real time. If for example, a taxpayer had failed to pay his PAYE, the ETCS would be updated. Thus, if the taxpayer was owed money, he would be obliged to make good the PAYE before being paid.

The system will also benefit taxpayers as they are saved the process of applying for a tax clearance.

The aim was to introduce this system in the final quarter of 2014 and to abolish the issuing of TCCs by April 2015.

However, the system has been delayed with no date given for implementation of ETCS.
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