Balancing taxpayer confidentiality and the public's right to know

Abstract

This research report considers whether the provisions which protect taxpayer confidentiality in the Tax Administration Act (TAA) and the Promotion of Access to Information Act (PAIA) strike the appropriate constitutional balance between privacy and the efficiency of the tax system, and competing rights. These competing rights are freedom of expression, freedom of the media, access to information and open justice. These rights concern the public's right to know information of public interest. The question that is examined is whether the taxpayer confidentiality provisions qualify as reasonable and justifiable limitations on the competing rights. It is submitted that in relation to the prohibition against disclosure of taxpayer information (section 67(3) of the TAA), a public interest defence is required to ensure that the prohibition is constitutional. In relation to requests for taxpayer information in terms of PAIA, the public interest override should apply to section 35 as it does with all other grounds of refusal under PAIA, resulting in taxpayer information of public interest being made available to requesters. Finally, adjudications before the Tax Court should generally take place in public, in contrast to the position adopted in terms of section 124 of the TAA.