KPMG in South Africa examines the new proposed penalty regime for understatement of taxes that, once enacted, has retroactive effect from 1 October 2012. The amendments to the current regime are contained in the Tax Administration Laws Amendment Bill (B40-2013). Despite the amendments, the new penalty regime is arguably more onerous than the current penalty legislation. It remains to be seen whether the above amendments are sufficient to render the legislation immune to successful constitutional challenge. For more details, read this Flash International Executive Alert.