SARS is pursuing the local operation of global cigarette giant British American Tobacco (BAT), claiming R143m for alleged tax fraud and evading excise duties, according to Business Times. The alleged contraventions, which BAT-SA denies, saw the company allegedly receiving undue rebates from SARS.

Instead, BAT-SA claims SARS still owes it R30m in rebates. According to a letter from SARS to BAT-SA, the rebates were received after BAT-SA applied to SARS to reprocess millions of cigarettes, including the Princeton brand, because of apparent manufacturing defects.

SARS found BAT-SA allegedly lied about the reasons for reprocessing the cigarettes, and in some cases merely changed the packaging to reflect a ‘limited edition’ cover.

SARS gave BAT-SA a way out: pay a R5m fine, R102m in excise duties and forfeitures. BAT-SA spokesperson Mandlakazi Sigcawu said: ‘BAT collected and paid more than R9.1bn in tobacco tax in SA last year. BAT-SA is currently owed about R30m by SARS, which it is erroneously withholding on the basis of wrong conclusions drawn by the audit team’ and R36m in interest, in place of facing prosecution.

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