Adidas in R1.9bn tax row with SARS

Nick Wilson
German sportswear giant Adidas is at loggerheads with the South African Revenue Service (SARS) over R1.9 billion the tax authority claims it's owed.
Business Day reported on the dispute on Monday, saying it had learned the SARS dispute over years of alleged underpayment on custom duties was with Switzerland-based Adidas International Trading and the company's SA unit.
While Adidas had not yet immediately responded to requests from News24 for comment, the company said in its 2022 annual report it was in "dispute with the local revenue authorities in South Africa with regard to the customs value of imported products".
According that SARS had issued a ruling in June 2018 claiming a "customs payment including interest and penalties for the years 2007 to 2013".
The company said it had applied for a suspension of the payment demand and had in 2019 instituted legal action against the decision before the high court.
It added that in a case of a ruling in favour of SARS, it would launch an appeal in the Supreme Court of Appeal.
"Based on external legal opinions, management currently believes that it is more likely than not that the claim made by SARS will eventually not result in an outflow of resources. Therefore, a provision was not recognised in the consolidated statement of financial position," it said.
SARS said it was "unable to comment" as laws prevent it from revealing any confidential taxpayer information.-Fin24