C:SARS v Capitec: A case of VAT equilibrium?
The Supreme Court of Appeal (SCA) recently upheld SARS’ appeal in a case against Capitec Bank Limited. The case involved input tax deductions in respect of loan cover payouts. The SCA ruled that Capitec supplied the loan cover in the course of providing credit, an exempt supply. One of the factors considered by the court was the impact that an input tax deduction would have on the equilibrium of Capitec’s VAT position. This article provides an overview of the case and raises a question on the equilibrium equation in the context of a vendor that makes exempt supplies.
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