Company: KARO
Filing Date: 2025-06-09
Form Type: 20-F
Source: 0001213900-25-052372
Chunk: 50

Company: Karooooo Ltd.
Filing Date: 2025-06-09
Form: 20-F
Item: Item 3
Chunk 50
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 some customers that require us to maintain specific/specified B-BBEE contributor levels as measured under the Amended Broad-Based
Black Economic Empowerment Information and Communication Technology Sector Code. We currently maintain a level 8 B-BBEE contributor level.

The government has set, and is in the
process of setting, specific equity targets by sector and region, where transformation initiatives have lagged.

Failing to achieve or maintain
a specified B-BBEE contributor level could affect our ability to maintain existing customers or to sell to large enterprise customers
in South Africa, which could have an adverse effect on our business, financial condition and results of operations.

Tax regulations and challenges
by tax authorities could have a material adverse effect on us and we may be subject to challenges by tax authorities.

We operate in a number of countries
and are therefore regularly examined by and remain subject to numerous tax regulations. Changes in our global mix of earnings could affect
our effective tax rate.

Furthermore, changes in tax laws
could result in higher tax-related expenses and payments. Legislative changes in any of the countries in which our businesses operate
could materially impact our tax receivables and liabilities as well as deferred tax assets and deferred tax liabilities. Additionally,
the uncertain tax environment in some regions in which our businesses operate may limit our ability to successfully challenge adverse
determination by any local tax authorities. Some of our businesses operate in countries with complex tax rules, which may be interpreted
in a variety of ways and could affect our effective tax rate. Future interpretations or developments of tax regimes or a higher than anticipated
effective tax rate could have a material adverse effect on our tax liability, return on investments and business operations.

In addition, we and our businesses
operate in, are incorporated in and are tax residents of, various jurisdictions. The tax authorities in the various jurisdictions in which
we and our businesses operate, or are incorporated, may disagree with and challenge our assessments of our transactions, tax position,
deductions, exemptions, where we or our subsidiaries or businesses are tax resident, or other matters. If we, or our businesses, are unsuccessful
in responding to any such challenge from a tax authority, we, or our businesses, may be required to pay additional taxes, interest, fines
or penalties, we, or our businesses, may be subject to taxes for the same business in more than one jurisdiction or may also be subject
to higher tax rates, withholding or other taxes. A successful challenge could potentially result in payments to the relevant tax authority
of