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Moneyweb reports that Solidarity has vowed to continue with legal action against state-owned arms manufacturer Denel for not adhering to its statutory obligations in terms of compulsory payments.
The trade union, which represents around 1,000 of Denel’s more than 3,500 employees, believes that Denel has deducted payroll taxes, retirement fund contributions, unemployment insurance and skills levies from its employees, but has failed to pay the funds over to the relevant bodies such as the SA Revenue Service (Sars). Denel responded that it was engaging Sars to find solutions regarding its “deferred payment application”, while Sars did not respond to an enquiry. Solidarity deputy general-secretary Johan Botha said they were concerned that Denel was not adhering to its statutory obligations in terms of Pay-As-You-Earn (PAYE), pension fund contributions and skills development levies. He said Denel had given an assurance that it had made the necessary arrangements with the relevant bodies, but the union was not convinced that the deductions have found their way to the rightful custodians of the funds. Botha indicated: “The bottom line is that Denel is merely the agent who collects the money on behalf of the pension fund and Sars. The statutory obligation remains between the employee and Sars for employees’ tax. Should anything happen, Sars can hold the employee personally liable for the amount that is outstanding. That is what we are trying to avoid.” Keith Engel of the SA Institute of Tax Professionals said the possibility of making arrangements for late payments to Sars was not quite the same as with any other tax, such as corporate tax. “It is not the employer’s money. If it is not paid over it means the employee may be prejudiced.”
- Read the full original of the above report by Amanda Visser at Moneyweb
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