SACP welcomes Constitutional Court ruling on Shuttleworth and money being moved out of the country willy-nilly

18 June 2015

The South African Communist Party (SACP) welcomes today’s Constitutional Court ruling setting aside last year’s Supreme Court of Appeal ruling which ordered the South African Reserve Bank to repay Shuttleworth R250.5 million in exit levy. The dispute dates back to 2008 when Shuttleworth applied to the Reserve Bank to transfer R1.5 billion out of the economy of South Africa to the tax haven of the Isle of Man where he moved to. Shuttleworth had paid the R250.5m, 10 per cent of the value he wanted out of South Africa, in exit levy when he transferred assets to the Isle of Man in 2009.

Based on the Supreme Court Ruling that has today been set aside last year Shuttleworth reserved the R250.5 million for a war chest against the government. The Constitutional Court ruling dealt a blow to this unpatriotic and dangerous agenda.   

Today’s ruling should also be seen as reaffirming our national policy sovereignty. This will go a long way if properly harnessed in defending our economy and currency against capital flight and its negative consequences. Exchange controls are particularly also important as a policy instrument to keep the resources needed for development in the country. Coupled with prescribed asset requirements to ensure investment in the productive sector of the economy together these can contribute positively in creating jobs, reducing poverty and inequality.

Liberation of exchange controls has cost the country massive amounts of resources in tax revenue which are needed to create jobs and finance economic transformation and development. Not only did our economy suffer ruinous capital flight but disinvestment and delisting. In the late 1990s Anglo, De Beers, Old Mutual and SAB Miller, Investec, Didata, Gencor, Liberty, etc. were allowed to dual list – in effect moving much of their corporate tax responsibilities, dividend payments and investments off-shore.

The SACP will continue with its Financial Sector Transformation Campaign, and reiterates its call to Nedlac to convene the Second Financial Sector Summit by the end of this year. Under the banner of the Financial Sector Campaign, the SACP will intensify the campaign for the adoption, and where already in place, for the strengthening of these and other important policies for the benefit of the people as a whole.

Statement issued by the SACP, June 18 2015