Gqeberha entrepreneur jailed for R1m VAT fraud

A Gqeberha entrepreneur has been sentenced to five years in prison for defrauding the SA Revenue Service (Sars) out of R1m. 

Charles Welile Miya, 61, the sole proprietor of Zidilex Trading CC, trading as Weza Projects, was convicted and sentenced in the city’s commercial crimes court this week.

He was found guilty on 16 counts of fraud after it was found he had contravened the Tax Administration Act and the VAT Act.

Weza Projects, a close corporation, was registered with Sars for VAT purposes in December 2008.

As the sole member and representative vendor, Miya submitted false VAT returns to Sars between 2018 and 2020, claiming incorrect input credits, resulting in him receiving undue refunds.

According to National Prosecuting Authority (NPA) regional spokesperson Luxolo Tyali, Miya had changed the company’s bank account details without notifying Sars, and then submitted revised returns without providing supporting documentation for it.

The false returns were submitted electronically, making it difficult for Sars to detect the fraud.

Tyali said Sars’ investigations revealed that Zidilex received more than R3.7m in undue refunds, but through swift action, it recovered just more than R2.7m, leaving the revenue service with a loss of about R1m.

Miya pleaded guilty to the charges.

Arguing in aggravation of sentence, state advocate Ronelle Brink highlighted the alarming increase in white-collar crime in the country, which had far-reaching negative impacts on the economy.

She said it was essential for individuals and businesses to prioritise ethical conduct and transparency in their dealings with Sars.

Magistrate Lionel Lindoor agreed, stating that Miya, as a social grant recipient, “bit the hand that feeds him”.

Despite Miya’s guilty plea and status as a first-time offender, the magistrate emphasised the need for accountability, and a sentence which would serve as a deterrent.

Welcoming the sentence, Eastern Cape director of public prosecutions advocate Barry Madolo applauded the prosecution, the police and the Sars internal investigation team for their meticulous and tireless efforts in bringing the case to court.

“This case serves as a stark reminder of the consequences of exploiting Sars, and the importance of honesty and compliance.

“Serious commercial crimes threaten the economic stability of the country, hence the NPA will channel all its resources to ensure we adopt an aggressive stance in prosecuting them,” he said.

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