14 of 2022`

Newsletter No 14 /14 April 2022                                 

                  

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SARS carries out search and seizure operations in various sectors

Tshwane, 7 April 2022 – The South African Revenue Service (SARS) through its Syndicated Tax & Customs Crime Division, carried out inspections as well as search and seizure operations on entities in the banking sector, tobacco and cigarette sector, alcohol, gold and clothing industries in KwaZulu-Natal, Western Cape and Gauteng.

The premises inspected and searched include the residential premises of certain individual taxpayers and gold industry and banking employees. The operations are related to wider investigations and audits into illicit financial flows and illicit trade in gold, alcohol, clothing, cigarettes and tobacco products.

The objective of these interventions are twofold: firstly, they assist SARS with its verification processes for tax compliance and identifying information that may support such audits. Secondly, SARS may corroborate its evidence already at its disposal for potential criminal proceedings.

These interventions were initiated after potential discrepancies were identified in customs declarations and tax returns related to such entities as well as bank statements which could not be relied on.

In one of the targeted entities, SARS obtained an order for a search and seizure of the premises of Bullion Star (Pty) Ltd on Monday 28 March 2021 in the North Gauteng High Court. Bullion Star is a gold refinery and has the facilities to transform minerals into a higher-value product, which can be sold locally or exported. Bullion Star is a registered exporter.

In contrast to Bullion Star’s previous returns submitted to SARS, the VAT return submitted for the 2022/02 period reflected a refund claim in the amount of R13.9 million. Prior to the end of January 2022, Bullion Star rarely exported any goods, but during February 2022, Bullion Star exported unwrought gold in excess of R126 million.

The above deviation caused Bullion Star to be selected for an audit of its tax affairs and the search warrant was executed in order to obtain information pertaining to the goods sold and exported by Bullion Star.

The warrant was executed at three premises. However, Bullion Star refused SARS access to its business premises and the vehicles on its premises. Security video footage revealed that goods were removed from the business premises and placed into vehicles on its premises, prior to SARS gaining access to the property. Based on the risk that these goods may be crucial to SARS’ investigation, with the assistance of the South African Police Service and the Directorate for Priority Crimes Investigation (Hawks), SARS seized relevant evidence from the vehicles.

Similarly, the occupants of the residential property of Bullion Star’s director also refused SARS access to the residential property and to provide SARS with electronic equipment. The premises and telephone were believed to contain information vital to the investigation. SARS requested the assistance of SAPS to gain access to the premises and seized goods from the premises.

SARS encourages all taxpayers and traders to ensure that their tax and customs obligations are up to date and in compliance with the tax and customs laws. Furthermore, SARS would like to thank the SAPS and DPCI for working within the whole of government approach in making sure that these interventions were executed successfully.

SARS Commissioner, Mr Edward Kieswetter, reiterated the organization’s and broader government’s commitment to combatting illicit trade and criminal economic activities.  He said, “Those persons that systematically and deliberately set out to deprive what is due to the fiscus through fraudulent and other non-compliant activities, will be confronted and dealt with in terms of the law. This kind of conduct will be made hard and costly.”

For more information, please contact SARSmedia@sars.gov.za

Cover your bases

Dion Govender unpacks a few of his favourite outerwear pieces as we gingerly skirt into the colder months

Winter is my favourite season of the year. I often joke that I would be happy in the Highlands of Scotland, but that’s big talk coming from a Saffa. We are fortunate (or unfortunate, depending on your affinity for the cold) in SA to experience relatively mild winters.  Also, we’ll take almost any excuse to get a fire going and throw a couple of tjops on the braai, but that’s another story. Two or three layers are all you need to keep you sufficiently insulated from the elements. Besides the apparent benefits that outerwear provides from inclement weather, it helps to anchor a rig. For this instalment of A Primer on men’s wear, I unpack a few of my favourite pieces as we gingerly skirt into the colder months.

The Quilted jacket

Quilted Jacket.
Image: barbour.com

One of the oldest sewing techniques used prolifically in the bedding industry applied to garment construction stitches layers of fabric with an insulated filling that traps air between the layers keeping the wearer sufficiently warm. A British heritage piece, the quilted jacket has been the go-to jacket for the town and country English gentleman. Noticeable by the quilt stitch detail on the outside of the jacket, generally in a diamond pattern, this nylon jacket is lightweight and perfect for a South African winter because of its lightweight and medium insulation. A slightly more sophisticated alternative to the puffer jacket, generally styled with patch pockets and a corduroy lined collar. This extremely versatile piece comes in many colours, with the traditional ones being navy, olive green or muddy brown. Pair them with brushed twill chinos and a chambray shirt.

The Aran Jumper or Jersey

Steve McQueen Aran jumper.
Image: Supplied

I always seem to lean towards traditional pieces with a sense of heritage. None more so than the Aran Jumper.  Aptly named after the Aran Islands off the west coast of Ireland, this Fisherman’s jersey was knitted by their wives from unscoured wool, which helped to repel sea spray and guard against the harsh elements that a fisher was prone to face. A bit of a marketing ploy, legend has it that every family had its own style to the knit, for in the event that the man met a sad end at sea, his sweater would wash onto the shore and offer some sort of closure for the grieving family. This chunky knit, traditionally available in an undyed off-white colourway, is another versatile piece of outerwear worn over a white crew T-shirt, Japanese selvedge denim with rolled hems and desert boots. Add some socks with a burst of colour to keep things nonchalant.

The Tweed jacket

Tweed Jacket.
Image: Supplied

Rugged, traditional, masculine and oozing class. This rough woollen fabric originated in Scotland. A mispronunciation of the Scots word “tweel”, the word for twill,the tweed jacket is a must for your winter wardrobe. Gone are the days when tweed was relegated to geriatric professor types (which I actually lean towards, myself. No chirps, thank you). Nowadays, with slimmer lapels, two buttons and a nipped-in waist, the tweed jacket is less country and more urban jungle. Lose the tie, dress your tweed with an OCBD — Oxford cloth button-down, lightweight knit, washed denim and some cognac-coloured wingtip boots. Don’t forget a muted pocket square to finish off the outfit.

The Denim Trucker Jacket

Levis Denim Trucker Jacket.
Image: Supplied

No conversation regarding outerwear would be complete without paying homage to the classic denim trucker. For a jacket that was first introduced around 1905 by Levi Strauss and Co, the fact that it is as relevant today as it was all those years ago speaks volumes. Based on a blouson style (a jacket that is cut shorter and cinched at the waist), I find myself always going back to my broken-in trucker every season. The perfect autumn transitional second layer, throw it on with just about anything, and you’re ready to go. You can’t go wrong with a crisp white T-shirt, slim-fit cargo pants and a pair of worker boots.

The Varsity Jacket

Varsity Jacket – Ralph Lauren runway show.
Image: Supplied

The iconic Letterman jacket was popularised around 1865 by the Harvard baseball team, an ode to Americana and a definite preppy staple. Fast forward to the 1980s, and the jacket was again granted a new lease on life by urban culture, becoming de rigueur with fashionable hip hop artists. A little daunting to dress, the contrasting leather sleeves and wool body with large embroidered letters may seem too much. With multiple iterations by numerous brands, toned down monochromatic versions can be found these days. Whichever version you decide to go with, a pique knit polo, fine wale corduroy pants and a pair of penny loafers will have you looking dandy.   Wanted BD

Mr Price enters R3.3bn deal to buy controlling stake in Studio 88

Retail giant Mr Price has signed a R3.3bn deal to acquire a controlling stake in the Studio 88 Group, which operates fashion retail brands including Studio 88, SideStep, Skipper Bar and John Craig.

The JSE-listed clothing, homeware and sport retail company announced on Tuesday, 13 April, that it entered into an agreement with the current management of Studio 88 Group and RMB Ventures to buy 70% of Blue Falcon Trading 188 Ltd, which owns the Studio 88 group of businesses.

Mr Price Group, which acquired both Power Fashion and Yuppiechef during the last two years, said that Studio 88 deal is in line with its plans to continue pursuing high growth opportunities with the vision of becoming the “most valuable retailer in Africa”.

The inclusion of the Studio 88 Group would increase Mr Price’s annual revenue to over R28bn and would prospectively become the group’s second-largest of nine trading divisions. Mr Price’s store footprint would increase to more than 2,400 stores and the group would employ over 25,000 people.
Founder-led, 21 year-old business

The Studio 88 Group is the largest independent retailer of branded leisure, lifestyle and sporting apparel and footwear in South Africa, generating revenue of R5.6bn for the financial year ended 30 September 2021. It is a founder-led business that has been operating in Southern Africa since 2001. The group operates more than 700 stores, predominantly based in South Africa, which are positioned in central business districts‚ regional malls and rural high streets, and via its e-commerce platforms.

A Sens statement by Mr Price noted that the Studio 88 Group is focused on consumers who make aspirational fashion choices, and the merchandise range is a mix of international brands – some of which are under exclusive license agreements – as well as private label ranges.

“The Studio 88 Group is highly cash generative and operates on a cash-only basis, which contributes to its value positioning. The management team of the Studio 88 Group has an impressive track-record of maintaining strong brand relationships and customer loyalty, delivering consistent earnings growth over the long term,” Mr Price said.
Focus on fashion-value and aspirational value segments

Having undertaken strategic research of the South African retail sector, Mr price said the aspirational value segment within the apparel sector was highlighted as an attractive investment area in which the group is currently under-represented.

According to Mr Price, the brands offered by the Studio 88 Group are complementary to Mr Price’s existing customer positioning and, combined, would deliver on the group’s strategic positioning across the fashion-value and aspirational value segments.

“With a diverse store footprint and a portfolio of differentiated store chain formats, the Studio 88 Group has broad appeal to aspirational and trend-conscious customers across a wide range of age profiles and affordability levels. Mr Price will benefit from growth opportunities in the menswear segment where it is currently under-represented,” Mr Price said.

Mr Price group CEO, Mark Blair, said, “The partnership with Studio 88 Group gives Mr Price an ideal entry into the high growth urbanwear and athleisure segments of the market, which present us with a significant non-competing channel. We will continue to be a predominantly private-label group, but our ‘Value Champion’ purpose can also be lived out through the aspirational fashion market, and we are very excited about these prospects.”

Blair continued, “What attracts us to the Studio 88 Group is their deep understanding of trend-conscious South African consumers and their ability to address their needs via their various trading formats. We also share a similar DNA, both being founder-led businesses intent on offering customers superior value and have high-performance cultures.”
Leadership

The founder of the Studio 88 Group, Laurence Wernars, will continue running the business, maintaining his trusted management team. Wernars said, “We are delighted to be partnering with an iconic South African retailer who has the vision and retail expertise that will be key to realising our considerable trading opportunities. I am very confident that there is strong cultural alignment with our new strategic partner and with our combined skills, we can accelerate our growth and contribute meaningfully to Mr Price achieving their vision.”

The seven senior management team members who are shareholders will remain in their current roles and as shareholders.

Mr Price will acquire 100% of RMB Ventures shareholding in Blue Falcon and management will dispose of an effective 50% of their shareholding, enabling Mr Price to acquire the sale shares. Management’s retained shareholding will be acquired over a four-year period post-implementation of the transaction, based on the same historical multiple as the initial acquisition.

The transaction is subject to the fulfillment of both regulatory and commercial suspensive conditions, as are usual for such transactions, by no later than 31 October 2022. These conditions include competition authority approval in South Africa and other African territories.  Bizcommunity

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The most talked about Oscars dresses of all time

Gwyneth Paltrow, 2002

Although she later regretted not wearing a bra, Gwyneth still likes her “goth” look by Alexander McQueen. Unfortunately, few critics could get over the sheer top and heavy eyeliner.

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