The SA Revenue Service (Sars), which like many other law enforcement agencies had been flying on sleep mode, decided that it was time for it to investigate the religious community for non-compliance with the country’s tax laws.
Sars said while it acknowledged that most religious organisations operated within the law, some were enriching themselves at the expense of the fiscus. It said its own investigation and several interactions with the Commission for the Promotion and Protection of the Rights of Cultural, Religious and Linguistic Communities (CRL) confirmed that there was massive non-compliance in the sector.
For a country that is battling to plug a R50billion revenue shortfall, the taxman’s decision to go after these mega-rich churches, who always plead poverty whenever asked to open their book, should be welcomed. Tax avoidance not only robs the government of much-needed cash to implement its redistribution programmes, but it also denies the poor an opportunity to access decent services from the state.
But for the investigation to be successful, Sars will need a specialised team to deal with the complexities that govern these religious enterprises.
Since the mid-1990s, religion in South Africa has become a commodity.
Churches have transformed from mere places of worship to profitable businesses.
The complicated schemes that govern their operations range from seemingly inane things such as divine waters to congregants to thousands of rand paid for a tête-à-tête with the leader.
CRL chairperson, Thoko Mkhwanazi-Xaluva, tried to use the commission’s legal authority to probe them without much success.
What she realises was that beyond the public posture of peace, tolerance and empathy for the poor, some church leaders were easy about unleashing thugs to protect their enterprises from any threats.
Instead of being entities that are deserving of public benefit exemptions under tax laws, these are complicated schemes that flourish on promising instant salvation to the poor.
And the source of income is mostly in hard cash and, therefore, difficult to quantify.
Had it not been for a rental fallout that Paseka Motsoeneng had with his landlord two years ago, South Africa would not have been privy to millions that circulate in these churches.
Motsoeneng revealed how he had paid R276000 rent every month and only stopped when the landlord shot the rental up to R576000.
The man who likes to call himself Prophet Mboro said he wanted the landlord to refund him the R11million he had already paid towards the R14m rent-to-buy agreement they had entered into.
As if to cement his status as the charismatic religion’s poster boy in South Africa, Motsoeneng treated himself to a luxury BMW i8, which goes for a cool R2m, a few months later.
This as he was telling Mkhwanazi-Xaluva that he was poor and that letting the commission scrutinise his financials would make him vulnerable to those who harbour ill-will against him.
Not to be outdone, another rising star in the sector, Malawian Shepherd Bushiri, took to social media to show a top-of-the-range Maserati Levante worth R1.5m he bought as a birthday present for his six-year-old daughter.
Before spoiling his “little princess,” the man who once famously claimed he could conquer gravity and walk on air had just charged congregants R25000 to sit next to him at a gala dinner.
In the meantime, the Universal Church continues to splurge millions on properties in every square-inch of the land in a retail-like expansion programme.
This is what Sars will have to contend with as it launches an investigation into the net worth of these individuals and entities who believe that paying taxes is akin to selling out on the son of man.
The investigation will have to probe whether the likes of Motsoeneng and Bushiri do pay for personal income derived from these churches, benefit tax on the gifts they receive from congregants and capital gains on any investments that they may have.
South Africa needs every cent it can get to continue with its programmes.
Sadly, in the past few years, Sars has not covered itself in glory.
While its overall revenue collection may have improved, its image among taxpayers is of an organisation that is involved in a permanent internecine strife.
Such a strike has seen key institutional memory lost and there has hardly been a major prosecution for tax avoidance to send a message to dodgers that Sars would get to them.
That is why it was heartening to hear President Cyril Ramaphosa saying during his State of the Nation address that he would appoint a commission of inquiry into tax administration and governance at Sars to restore its credibility and to strengthen its ability to meet its obligations.
He said tax morality in South Africa was dependent on an implicit contract between taxpayers and the government.
Such a relationship, he argued, had to be free of any corruption.
Indeed it is through such an independent probe that Sars would be able to determine ways of going after this perceived impunity among tax dodgers.
That way we can be able to throw high-fives among ourselves and celebrate the dawn of the new era.
And that in a modern democracy such as ours, even charlatans such asthese so-called prophets and their ilk are not above the law.
- BUSINESS REPORT