South Africa said it signed an agreement with 12 other countries to combat cross-border tax evasion.
South Africa’s tax take is under pressure as the country’s economic recovery has not been as strong as anticipated. The finance ministry expects revenues to take up to four years to recover to its levels before the recession in 2009.
In a statement, the treasury said it signed the Convention on Mutual Administrative Assistance at the G20 meetings in France. The treaty would allow the country to share tax information with other countries, Reuters reports.
“The benefit is that our country … will automatically have the benefit of exchange of information, simultaneous tax examinations (audits) between revenue administrations of different countries,” it said.
South Africa’s revenue service has tightened tax collection, steadily raising the tax ratio to just below 30 percent of GDP just before the 2009 recession from 25 percent in the 2003/04 financial year.
Other signatories include Russia, Australia, Turkey, Brazil, China and Germany.