The influence of Bato Star Fishing (Pty) Ltd v Minister of Environmental Affairs and Tourism and Others in shaping South African Tax Administration

Abstract

Before the commencement of the constitutional state era (due to the promulgation of the Constitution of the Republic South Africa, 1996 (‘the Constitution’)) in South Africa, taxpayers’ rights were not protected when taxpayers engaged with the revenue office, now known as the South African Revenue Service (SARS). Taxpayers had no right to just administrative action and could not challenge the exercise of SARS’ powers on administrative grounds. Croome and Olivier argue correctly that during the pre-constitutional era, taxpayers were entitled to expect that SARS would comply with the general principles of administrative law, comprising the principles of audi alteram partem (‘hear the other side’), nemo iudex in sua propria (‘no one may be a judge in his own cause’) and the commonlaw principles of judicial review of administrative acts (see Croome & Olivier, Tax Administration (Juta 2010) 21). Further, SARS was not obliged to provide reasons to taxpayers for decisions taken by them as long as the decisions were reached in accordance with its wide legislative powers (see Croome & Olivier, (Juta 2010) 21). This means that taxpayers did not have any ammunition to challenge the exercise of SARS’ powers on administrative grounds prior to the commencement of the constitutional era, where no reasons were provided. The position mentioned above has changed and SARS’ actions can now be measured against the fundamental rights entrenched in Chapter 2 of the Constitution and the administrative principles laid down in the case of Bato Star Fishing (Pty) Ltd v Minister of Environmental Affairs and Tourism and Others 2004 (4) SA 490 (CC) (‘Bato Star Fishing’).