South Africa’s multinational brewing and beverage company, Distell Ltd has been charged to pay more than R131.4 million to the South African Revenue Service (SARS) on or before Friday after losing its latest legal bid for an order suspending any payment to the tax collector for the “spirit based” drink- Amarula Cream.
Its fight against the reclassification of their product from a wine based drink to a spirit based drink has been for some time a crucial issue between SARS and the company.
By classifying Amarula as a spirit based drink, the group is forced to pay millions of rand for its high in excise duty.
The company which has earlier lodge a complaint to the Supreme Court of Appeal (SCA) requesting that its payment be suspended pending the final outcome of its ongoing legal battle was turned down as two judges of the SCA last week dismissed the application ordering that Distell pay R131.4m, which is part of R213m it allegedly owes to Sars.
SARS then moved further to launched an urgent application against the liquor giant by forcing it to pay-back all it’s owing. Adding that the principle of “argue now, pay later” would no longer be applicable.
SARS refused to listen to any appeal for suspension of the payment but went further to issue them a letter on February, demanding the tax payment but the group is yet to comply.
In October, the high court cut short Distell’s intended appeal against the classification and the group at that time asked the court for permission to go ahead with their application, although they were four years late in lodging the appeal.
The group however claim to have good reasons for taking so long before it turned to court but the judge found none of these reasons were valid.