 The government has high hopes for the amnesty |
As much as $8bn could be on its way back home to South Africa if early responses to the tax amnesty on overseas holdings are anything to go by. The six-month amnesty does not even begin till May, yet tax officials received inquiries about more than 3bn rand ($373m; �233m) in the first 48 hours.
That, Revenue Service Commissioner Pravin Gordhan told the BBC's World Business Report, could mean a total take of $2bn-$8bn.
"I think people in South Africa are realising that for all sorts of reasons they might have erred," he said.
"They would like to normalise their affairs and would look to this opportunity."
Expanding the pot
Mr Gordhan's boss, Finance Minister Trevor Manuel, announced the amnesty as part of a far-reaching 334bn rand budget package on 26 February.
Setting growth forecasts for 2003 of 3.3%, down from the 3.5% set in October, he unveiled a 13.3bn rand tax break for middle to low income earners, thanks to higher tax receipts last year, and lowered the tax on pensioners' retirement funds from 25% to 18%.
But the weakness of the world economy is hitting tax receipts, and new sources are needed.
One obvious candidate was the billions extracted by South Africans in an attempt to evade strict foreign exchange controls.
With those controls now being relaxed, Mr Manuel said it was time to allow the money to come home.
Pragmatic?
What little criticism there has been of the plan revolves around suggestions that it is unfair to people who have always paid their taxes.
But Mr Gordhan said that honest taxpayers would be among the amnesty's biggest beneficiaries.
"Ultimately, those who have paid their taxes want to see others paying their taxes," he said.
The widening of the tax base by bringing former transgressors back into the fold - and promising them anesty from prosecution or civil recovery - "would contribute to the further development of South Africa".
"That benefits those who have been paying as well," he said.
Anyone bringing their money home will have to pay a 5% charge, as well as settling tax liabilities for the year 2002/03. If the money stays abroad, the charge is 10%.
But in either case, all tax liabilities from before April 2002 are wiped out.