A Comparison of the General Anti-Avoidance Provisions in the Australian and South African Income Tax Acts With Reference to Whether or Not the South African Anti-Avoidance Provisions Would Have Been Applicable to the Facts of FCT v Spotless Services Limited

Abstract

The decision of the Australian Courts in the case of FCT v Spotless Services Limited was cause for considerable concern among the ranks of the Australian tax fraternity. The decision hinged on an application of the general anti-avoidance provisions (contained in sections 177A-177G) of the Australian Income Tax Assessment Act. The purpose of this paper is to compare the general anti-avoidance provisions of the Australian and South African Income Tax Acts in order to ascertain whether or not, based on the facts of the case, a South African Tax Court would have come to a similar conclusion as that reached by the Australian Court.

Key Words:

• General anti-avoidance provision
• Scheme
• Tax benefit
• Abnormality
• Sole or main purpose