Arena Holdings (Pty) Ltd t/a Financial Mail v SARS (88959/2019)

Reference to “the Constitution” is to the Constitution of the Republic of South Africa, Act 108 of 1996.

Background:

The Financial Mail sought access to the tax records of a former member of the executive (Mr Zuma) on the basis that evidence in the public domain which had not been denied or controverted by Mr Zuma indicated that he was not tax compliant during his presidency.

Issues:

Taxpayer confidentiality is provided for in, inter alia, section 35 of the Promotion of Access to Information Act 2 of 2000 (PAIA), section 69 of the Tax Administration Act 28 of 2011 (TAA), and section 14 of the Constitution which guarantees the right to privacy.

Section 35 of PAIA provides that disclosure of information obtained or held by SARS for the purpose of enforcing legislation concerning the collection of revenue must be refused if that information relates to a person other than the requester.

Section 69 of the TAA imposes an obligation on SARS officials to “preserve the secrecy of taxpayer information” and prohibits the officials from disclosing taxpayer information to a non-SARS official.

The question was whether the right of access to information guaranteed in section 32 of the Constitution and in PAIA and the obligation of the media to impart information, which is in the public interest, as guaranteed in section 16 of the Constitution, overrode the taxpayer’s rights to privacy and confidentiality in this instance.

Ruling:

The court firstly assessed whether the blanket ban on disclosure of taxpayer information in terms of section 35 of PAIA and section 69 of the TAA were justifiable limitations of the rights of access to information and freedom of expression.

The court had regard to section 36 of the Constitution which provides for the limitation of rights subject to certain relevant factors to be taken into account. Factors to be considered include (i) the nature of the right, (ii) the importance of the purpose of the limitation, (iii) the nature and extent of the limitation, (iv) the relationship between the limitation and its purpose, and (v) whether there are less restrictive means to achieve the purpose.

The court referred to various cases in which the Constitutional Court had already struck down prohibitions relating to the provisions of a sensitive nature or where privacy rights were involved such as Mail and Guardian Media Ltd v Chipu and Johncom Media Investments Ltd v M and Others.

Having regard to the above, the court held that the limitation of the media’s rights of access to information and freedom of expression was not justifiable under section 36 of the Constitution.

The court further held that, in light of the nature of the case and the legal and constitutional questions involved, it was of the view that this was an appropriate case where a substitution of the decision of SARS to refuse access to information should be made.

Accordingly, the court ruled that section 35 of PAIA and section 69 if the TAA were unconstitutional and invalid to the extent that they precluded access to tax record by a person other than the taxpayer and the further dissemination of information obtained as a result of a PAIA request.

SARS was ordered to supply the media with the individual tax returns of Mr Zuma for the 2010-2018 tax years.

Find a copy of the case here.

26/11/2021