Multiple South Africans are driving Ferrari supercars while reporting salaries of under R33,300 per month to the South African Revenue Service (SARS).
This is according to a report by MyBroadband, which covered a webinar about the future of financial wealth in South Africa.
Judge Dennis Davis, chair of the Davis tax committee, was a presenter in the webinar and said they made the finding during a recent study.
Davis said a SARS employee observed a local hotel “with very fancy Ferraris parked outside” and took down the registration numbers of 26 cars.
Using these registration numbers, they traced the owners of the Ferraris and looked at how much taxable income they declared to SARS each year.
What they found was that not one of the 26 owners reported a taxable income of more than R400,000 per year.
This works out to R33,300 per month.
Davis stated that it is not possible for a person to afford a Ferrari on this type of salary.
The cheapest new Ferrari for sale in South Africa is the Roma, with a starting price of R4.85 million.
According to SARS, there are very few people who declare a high enough income to afford these types of supercars.
Davis said that SARS must take action against people who under-report their income, and the service must run lifestyle audits on wealthy South Africans and people who own expensive cars.
“If you have a R3-million Ferrari but are only reporting R100,000 in taxable income, I think SARS is entitled to knock on your door and ask you to explain,” he said.
Davis added that South Africa is losing over R100 billion each year due to individuals and businesses dodging tax.
Factors affecting the future of financial wealth in SA – Webinar
The video below contains statements from Davis on the findings.