| Summary: | Submitted in fulfillment of the requirement for the Degree of Master of Technology: Taxation, Durban University of Technology, 2013. === South Africa has seen tremendous changes since 1994, from the introduction of a new government to structural changes in tax administration; one of the challenges the government faced in the new democracy, was the restructuring of the tax system. Multiple tax amnesty programs were thus introduced between 1995 and 2010 to provide immunity for limited periods to citizens and small businesses for past non-compliance without being subjected to additional tax, interest, penalties or prosecution. Although extensive research conducted abroad has illustrated the potential problems and complexities that could arise from multiple amnesties, very little research has been conducted in South Africa to evaluate the viability of offering repeated amnesties. The emphasis in this study was therefore on the Small Business Tax Amnesty of 2006, and its primary purpose was to explore the effects that multiple tax amnesties have on compliance and whether it is possible for tax compliance to improve if further tax amnesties are introduced.
This study used a quantitative research approach to gather data from 146 respondents from an Audit firm database containing information about taxpayers qualifying as small business who applied for amnesty and taxpayers that did not apply for amnesty between 1 August and 30 June 2007. Analysis of the data revealed that tax amnesties in South Africa should not be offered on a frequent basis to non-compliant taxpayers as it causes non-compliant taxpayers to anticipate further amnesties which could impact negatively on tax compliance as a whole. The findings also indicated that educating taxpayers about tax issues could result in better tax compliance thus contributing to the development of a fair and equitable society. Based on the findings, this study makes recommendations to government, the tax authority and policy makers regarding the effects of multiple tax amnesties.
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