Xolile Mtembu|Published
A Gqeberha businessman who was implicated in fraudulent VAT claims worth approximately R4.7 million has escaped direct imprisonment after a court handed him suspended sentences.
Sipho Christian Tys, 54, and his construction company, Lisolanele Trading Enterprises CC, were sentenced by the Specialised Commercial Crime Court in Gqeberha on Friday following a Hawks investigation into fraudulent Value-Added Tax (VAT) claims.
Warrant Officer Ndiphiwe Mhlakuvana said the case stemmed from fictitious VAT returns submitted between 2015 and 2017.
“During the investigation, invoices and other documents submitted to SARS through its eFiling platform were found to have been fabricated,” Mhlakuvana said.
SARS uncovered discrepancies in the documentation and referred the matter to the Hawks Serious Commercial Crime Investigation team for further investigation.
The investigation led to the arrest of Tys and the prosecution of his business entity in 2023.
They were subsequently released on bail of R2,000 and made numerous court appearances before their sentencing.
Tys was sentenced to eight years' imprisonment for fraud and forgery, but the entire sentence was suspended for five years on condition that he was not convicted of fraud or forgery committed during the suspension period.
The court also ordered him to repay SARS over R1.2m.
According to the supplied sentencing order, Tys must make an initial payment of R20,000 by December 1, 2026, followed by monthly instalments of R20,000 and a final payment of R18,061.58.
The order specifies November 1, 2031 as the date for the final payment.
For contravening the Tax Administration Act, Tys received a further three-year prison sentence, wholly suspended for five years, on condition that he was not convicted of failing to submit income tax returns during that period.
His company, Lisolanele Trading Enterprises CC, was sentenced to five years' imprisonment for fraud and forgery, wholly suspended for five years, on condition that it was not convicted of further fraud or forgery during the suspension period.
The company also received a three-year suspended sentence for contravening the Tax Administration Act, subject to the condition that it was not convicted of failing to submit income tax returns during the same period.
Mhlakuvana said the case followed an investigation into the alleged tax fraud, with fabricated supporting documents used to substantiate claims amounting to millions of rand.
The sentencing brought the lengthy legal proceedings to a close, although the suspended sentences mean that Tys and his company will have to comply with the court's conditions to avoid serving their prison terms.
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