LEADING THE WAY
Where the interpretation of tax law is not clear, it is not uncommon for a taxpayer to seek a private ruling from the Revenue Department. Frequently, taxpayers find that the rulings that they receive are not in their favour. Perhaps, unsurprisingly, rulings tend to interpret the law in a manner that results in the payment of more, not less, tax.
In such cases, some taxpayers may follow the Revenue Department's interpretation and pay tax in accordance with the ruling. Other may choose not to follow the ruling with the result that they are issued a tax assessment and have to defend their position in court.
Rulings are sought where the interpretation of the law is unclear, or where the law does not address a specific situation. However, rulings issued by the Revenue Department often appear to be adding to or extending the law as set out in the Revenue Code.
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