Pretoria, Tuesday 17 November 2020 – The General Assembly Meeting of the African Tax Administration Forum (ATAF) has elected the Commissioner-General of the Togolese Revenue Office, Mr Philippe Tchodie, as the new Chairperson of the ATAF Council and the Commissioner of SARS, Mr Edward Kieswetter, as the ATAF vice-chairperson. 

The ATAF Council is elected for a two-year term to provide strategic guidance and leadership for the fulfilment of the organisation’s vision and objectives. The new Council to preside over the destiny of the organisation is composed of Togo (Chair), South Africa (Vice-Chair), Burundi, Kenya, Morocco, Mozambique, Rwanda, The Gambia, Uganda and Zambia.

SARS was not only instrumental in the formation of ATAF but as a former founder member has remained seized by the activities of the organization since its inception 10 years ago.

Mr Kieswetter said he was delighted at the trust that tax organisations on the African continent placed in SARS. 

“This is a wonderful endorsement of the vital role played by SARS in helping to grow our country and our continent through the effective and efficient administration of our tax system.  

“African tax administrations have the mammoth task of dealing with the fallout of the COVID-19 pandemic in the short term, while boosting domestic revenue and curbing practices such as transfer pricing and the illicit financial flows of vast sums of money that are lost to the continent every year,” Mr Kieswetter said.

“In this regard, SARS will continue to play its role as a fellow African tax authority in building capacity, sharing information and applying the relevant treaties that are aimed at promoting tax compliance throughout the continent.”

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Pretoria, Thursday 12 November 2020 – The South African Revenue Service (SARS) reminds individual taxpayers who are required to file an income return that they have until Monday 16 November 2020 to submit returns via the online platforms, namely the SARS MobiApp or eFiling.

Provisional taxpayers who use eFiling have until Friday 29 January 2021 to submit their returns.

Taxpayers who have received auto-assessment from SARS, which means their returns have automatically been filed and assessed, are reminded that they must accept the assessment or edit their return on eFiling.

Tax season for individual taxpayers who file at a branch closed on Thursday 22 October 2020.

SARS wishes to thank all taxpayers who have submitted their returns thus far, irrespective of the platform used.

Taxpayers must note that SARS will deal decisively with non-compliance such as the non-submission or late submission of returns.

Taxpayers who are yet to file can download the SARS MobiApp from the Playstore or Appstore and easily perform the following functions amongst others:

1. Register as a taxpayer and for SARS eFiling

2. Submit a return

3. Use the phone camera to upload supporting documents

4. Retrieve their username or reset their password

5. View their Notice of Assessment (ITA34)

6. Request a call-back to get the assistance of a SARS agent.

Not every taxpayer needs to submit a return. Taxpayers who meet all of the following criteria need not submit a return:

1. Their total employment income for the year before tax is not more than R500 000

2. They only receive employment income from ONE EMPLOYER for the full tax year

3. They have no other form of INCOME (e.g. car allowance, business income, and rental income, taxable interest or income from another job)

4. They don’t have any additional allowable tax related deductions to claim (e.g. medical expenses, retirement annuity contributions and travel expenses).

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PRETORIA, WEDNESDAY 11 NOVEMBER 2020 – The Gauteng High Court in Pretoria has upheld the seizure by the South African Revenue Service (SARS) of the horse and trailer used for the transport of fuel unlawfully imported into South Africa. SARS has similarly seized the fuel and the court has also upheld SARS’ seizure in that regard.

The application, launched by Drontech Engineering (Pty) Ltd was dismissed with costs of two counsel, one of whom is a senior counsel.

SARS Commissioner Edward Kieswetter said the court has sent a clear message to role players in the fuel industry that vehicles which are used to smuggle fuel into South Africa, will be liable to forfeiture and may be seized.

“SARS will not tolerate any efforts to undermine the integrity of our tax and Customs administration through the illegal importation of goods across our borders where the applicable duties and levies are not paid.  SARS will continue to act firmly and resolutely against illegal fuel importation, which compounds the challenge of illicit activities that are so pervasive in our country. This judgment reaffirms our determination to thwart this criminal conduct that undermines our economy”.   

“SARS will make it hard and costly for anyone that engages in such non-compliant behaviour by ensuring that they face the full might of the law. We are determined to work towards deepening a culture of compliance and tax morality in our young democracy,” Mr Kieswetter added.  

“The revenue that SARS collects from imports and exports of goods is vital to the social and economic development of our country. It also enables the provision of public services such health, education and social grants to be provided to the poorest of the poor,” the SARS Commissioner said. 

The truck and trailer were seized by SARS in March 2018. This was after SARS found that the fuel was unlawfully imported into South Africa by means of the truck and trailer and that the truck and trailer had also been used on previous occasions to smuggle fuel from Mozambique into South Africa.  In all instances, the fuel was declared and ostensibly destined for Zimbabwe, but was introduced into the South African market without the applicable duties and levies having been paid.

In conclusion, Commissioner Kieswetter re-emphasized that “any transporter engaged in the transport of fuel cross-border is only permitted to do so if they are licensed as a remover of goods in bond in terms of the Customs and Excise Act. If you are found without such a licence, that will be considered as a transgression of the law”.

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Pretoria, Wednesday 28 October 2020 – The South African Revenue Service (SARS) welcomes the commitment made by the Minister of Finance Tito Mboweni to reduce the budget deficit and achieve higher economic growth when he presented the Medium Term Budget Policy Statement (MTBPS) in Parliament earlier today.

The 2020 MTBPS delivered by the Minister of Finance this afternoon outlines a fiscal consolidation plan to limit the growth in government operational spending and support economic growth over the medium term as outlined by President Cyril Ramaphosa in the Economic Reconstruction and Recovery Plan.

The global economy is returning from the depths of its collapse in the first half of 2020, due to eased COVID-19 lockdowns, unprecedented as well as rapid policy support by central banks and governments globally. Global growth is now projected by the IMF to contract by 4.4% in 2020, 0.8 percentage point higher than the June 2020 forecast.

South Africa’s real economic growth is expected to plummet in 2020 as seen in the downward revision of the GDP growth forecasts, primarily due to restrictions on economic activity to contain the spread of the COVID-19 virus.

The economy was underperforming prior to the COVID-19 shock, contracting for three consecutive quarters before the lockdown. The domestic economy contracted by 16.4% in Quarter2 of 2020, the biggest decline since 1960 – marking the fourth quarter of the recession in 2020. The IMF forecasted a contraction of -8% (2020), thereafter a growth of 3% (2021) for South Africa.

In the 2019/20 financial year, SARS collected a net amount of R1 355.8bn, against the Revised Estimate of R1 358.9bn, resulting in a shortfall of R3.1bn (-0.2%) and a growth of R68.2bn (5.3%) from 2018/19. The Printed Estimate for 2020/21 was R1 425.4bn with a required growth of in tax revenue of 5.1%. This estimate was revised down in the June 2020 Supplementary Budget to R1 121.3bn due to the COVID-19 pandemic. The revised Supplementary Budget estimate of R1 121.3bn represented a contraction of R234.1bn (-17.3%) against the previous year.  

In the June 2020 Supplementary Budget, government made provisions for taxpayers to alleviate tax obligation pressures induced by the COVID-19 pandemic. A total of 252 398 taxpayers have made use of the relief measures with a total of R52.7bn deferred as follows:  R1.6bn (PAYE), R33.0bn (Provisional tax), R19.2bn (Customs and excise) of which R18.4bn is for alcohol beverages and tobacco producers.

As at 30 September 2020, SARS collected R518.8bn, with a surplus of R9.3bn (1.8%) against the June 2020 Special Estimate, and a shortfall year-on-year of R117.0bn (18.4%) in nominal terms. All tax types recorded a shortfall. The major tax types performed as follows against the prior year: PIT Net (-12.0%), CIT Net (-24.9%), Net VAT (-15.0%).

Subject to available funding, SARS will continue rebuilding its enforcement capabilities and tools; enhancing its data matching capabilities and make more use of artificial intelligence.

The SARS Commissioner Edward kieswetter said, “Low real growth in the economy coupled with low inflation rates does reduce the revenue potential from taxable activities.  There is a close correlation between growth in tax revenue and growth in nominal GDP – which is really a measure of economic performance.”

Mr Kieswetter added that, “Improved tax collection and administration continues to be an important element in achieving fiscal consolidation, as SARS continues to rebuild its capacity. As an organisation, our near-term objectives include:

• Finalising the tax gap study in December 2020 to quantify the difference between how much tax should be collected and how much is collected.
• Remaining focused on international taxes, particularly aggressive tax planning using transfer pricing.
• Increasing enforcement to eliminate syndicated fraud and tax crimes.
• Continuing to use third-party data to find non-compliant taxpayers.
• Collecting PAYE pay-as-you-earn and VAT debt, and ensuring that outstanding taxpayer returns are filed and liabilities paid.”

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Pretoria, Friday 16 October 2020 – The South African Revenue Service (SARS) welcomes the North High Court decision in the matter between the Commissioner for the SARS and Zikhulise Cleaning Maintenance and Transport Service on 14 October 2020. A final liquidation order was finally issued against a company who was placed in provisional liquidation in 2018. The company through its representative, Ms Mkize, opposed the granting of a final order. The company attempted to show that it met the solvency test by disputing its debt to SARS. The Judge relied on SARS version of the company’s indebtedness and confirmed that the company was factually and legally insolvent.

The judgment reaffirmed SARS’ right to liquidate a taxpayer where an assessment is under appeal. The judge confirmed when it is just and equitable to liquidate a company and made numerous references to the company’s behaviour, specifically ceding State tenders to the detriment of its creditor SARS, and benefitting from State funding yet avoiding its tax obligations.

This precedent-setting judgement is important in a number of ways. It empowers SARS to act decisively against a taxpayer who attempts to circumvent its fiscal obligations by using the court process to restrict SARS from collecting outstanding debt. While SARS will always respect the right of taxpayers to approach the courts to seek relief, it will oppose any such court action if it is vexatious and intent on stalling the debt collection process.

Commissioner Edward Kieswetter expressed SARS’ unyielding commitment to enforce compliance against taxpayers who abuse the legal process to avoid their obligations.

“SARS will act within the law and will pursue without fear or favour any taxpayer who is bent on evading their legal obligations,” he said.

He further stated that it was unconscionable that taxpayers, especially those that have made their fortunes through government tendering, would through their carefully calibrated actions, seek to deprive poor and vulnerable South Africans who depend on state-funded social grants by not paying their taxes.

The SARS Commissioner said SARS would at all times work towards finding a mutually acceptable solution for taxpayers by providing certainty and clarity as well as making it easy for taxpayers to meet their obligations. However, SARS would also oppose to the highest court of the land any action that is ill advised- and ill construed. This more so, if it is pursued by people who brazenly and ostentatiously defy the law. 

“This victory must send a clear and unambiguous message to all citizens that SARS will make it costly and hard for taxpayers who choose the path of non-compliance.”

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