Edward Kieswetter
Edward Kieswetter

Kieswetter, businessman settle tax feud after a 10-year court battle

By Sizwe Dlamini Time of article published Mar 3, 2020

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JOHANNESBURG - South African Revenue Service (Sars) commissioner Edward Kieswetter welcomed the victory against Gary van der Merwe and various entities he controls after a 10-year court battle which ended up in the Constitutional Court.

The Constitutional Court on February 5 dismissed Van der Merwe’s application for leave to appeal an eviction order requiring him to vacate his home, which is held by Zonnekus Mansion. The court held that the application bore no reasonable prospect of success.

Kieswetter said in a statement: “The Constitutional Court order paved the way for the liquidators of Zonnekus to take control of the last remaining asset of Zonnekus. The sheriff has evicted Van der Merwe from the property and placed it under the control of the liquidators. The liquidators can now sell the remaining property in order to recover the outstanding tax debt."

Van der Merwe said Kieswetter failed to state that Sars had no involvement in the eviction litigation, which was conducted between a family trust and the liquidators of Zonnekus Mansion.

“Kieswetter is either knowingly dishonest or being lied to by his advisers,” he said.

Kieswetter said the Sars investigation had originated from a Financial Intelligence Centre (FIC) report regarding a suspicious transaction, involving an amount of about $15million (R234.6m).

Van der Merwe contends that this payment was made as a gift to his daughter in 2014.

“Sars tried to freeze the funds in urgent High Court proceedings on the basis of false statements made under oath that the funds were actually mine and that I tried to import it into South Africa in her name.

“However, Sars was forced to settle with my daughter, and withdrew the preservation order when she agreed to pay income tax on the gift (on the basis of the pay now, argue later rule), although donations are not taxable in the receiver’s hands,” he said.

According to Van der Merwe, the tax payment was made under protest, only to get rid of his daughter’s harassment by Sars, and the appeal against the payment is awaiting a hearing before a full Bench of the Cape High Court.

“In reaching the agreement with my daughter, Sars conceded that I had no connection to the gift received by her, contrary to the false statements previously made under oath by Sars officials," Van der Merwe said.

“Kieswetter fails to include these vitally relevant facts in his media statement and maliciously spins a false narrative in order to claim false reflected glory for Sars, when in fact the Sars officials involved in the shakedown against my family behaved dishonestly, dishonourably and unconstitutionally,” he said.

Kieswetter praised the Sars litigation team "for their sterling work in this drawn-out matter.

“While the organisation is rebuilding the capacity that was deliberately destroyed over the years, there are women and men who retain the wherewithal to effectively manage large and complex legal matters."

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