SARS

22 February 2019 – SARS Customs intercepts luggage containing cocaine worth over R3 million

Pretoria, 22 Friday 2019 – Following months of intense surveillance and observing various flights, yesterday the South African Revenue Service (SARS) Customs officers, stationed at OR Tambo International Airport, successfully profiled a suspected drug smuggler, and intercepted her luggage containing cocaine valued at over R3 million.

The traveller, who arrived from Sao Paulo, initially denied checking in any luggage. However, when the officers enquired further, it was established that she had checked-in luggage weighing 23 kilograms.

The officers then found her checked in bag on the carousel. During a physical inspection of the bag, two backpacks filled with 10.645kg of suspected cocaine were discovered and the woman was immediately detained.

A criminal case for drug smuggling and an attempt to defeat the ends of justice by denying knowledge of the luggage was registered at the local police station.

The passenger was then arrested pending her court appearance on the charges.

31 January 2019 – Trade Statistics for December 2018

Trade Statistics for December 2018

Pretoria, 31 January 2019 – The South African Revenue Service (SARS) today releases trade statistics for December 2018 recording a trade surplus of R17.17 billion. These statistics include trade data with Botswana, Eswatini, Lesotho and Namibia (BELN).

Please click here to read the media release.

25 January 2019 – International customs day celebrations

Pretoria, 25 January 2019 – The South African Revenue Service (SARS) celebrated the International Customs Day (ICD) a day earlier today to honour the men and women who protect the country’s borders and help facilitate trade.

For almost seven decades since 1953 the ICD has, every year, without fail held and highlighted celebrations to mark the inaugural session of Customs Cooperation Council (CCC).

For this year the International Customs Day (ICD) 2019, which is decided by the World Customs Organisation (WCO), has chosen the theme to be “SMART borders for seamless Trade, Travel and Transport”.

To mark the significant event, SARS’s Customs and Excise division held celebrations at two venues, that is, the ICD in Pretoria and at Beitbridge Port of Entry in Limpopo.

The main event in Pretoria was headlined by the Acting Chief Officer: Customs & Excise: Beyers Theron who delivered the keynote address.

The event took the form of a trade exhibition, with a number of stalls highlighting some of Customs’ strategic projects, including the Preferred Trader programme, New Customs Acts Programme (NCAP), IT capability, Partnerships, new e-Traveller Card and focus on the illicit economy.

Importantly, in Beitbridge, the event was jointly celebrated with officials from the, South African National Defence Force (SANDF), Zimbabwe Revenue Authority (Zimra) and highlighted some of the co-operative projects that the two administrations are working on together.

Both events included the traditional issuing of WCO certificates to various SARS staff and external stakeholders who have made positive contribution in pursuit of effective and smart control of the movement of goods.

“This year’s theme seeks to highlight the need for all of us in the agency to ensure that there’s swift and smooth cross-border movement of goods, people and means of transport,” said Theron.

SARS maintains that it is a collective responsibility as customs and border regulatory stakeholders to support efforts to grow the economy by ensuring that we bring the concept of seamless movement of legitimate goods and people to the border environment by the application of the SMART principles.

The concept of SMART borders provides a blueprint that can be used and applied by customs and other border regulatory partners in order to reduce the time and costs spends associated with cross-border traffic by strengthening the whole-of-government endeavour in that regard.

By SMART we mean that Customs, in partnership with other border regulatory stakeholders, should ensure that the following guiding principles of a SMART border are addressed:

  • Secure – This aspect calls for Customs, partner government stakeholders and economic operators to pursue the common objective of enhancing supply-chain security and efficiency based on mutual trust and transparency while safeguarding revenue collection.
  • Measurable – Measuring the actual performance of Customs and border regulatory stakeholders in facilitating trade and controlling borders, as well as evaluating overall border performance, are two major pillars at the heart of sound decision-making using, for example, instruments such as the WCO Time Release Study (TRS) to accurately measure elements of trade flows and identify bottlenecks so that appropriate decisions can be formulated and implemented.
  • Automated – Automation underpins every aspect of a modern Customs administration and, by extension and in partnership with border regulatory stakeholders, also of a seamless border environment.
  • Risk Management-based – An intelligence-driven and data-enabled risk management framework allows Customs and border regulatory stakeholder partners to be more effective at all levels, especially in decision-making and targeted interventions.
  • Technology-driven – Digital disruption has brought about new opportunities and challenges for Customs and partner government stakeholders, which triggers the need to explore the use of Information and Communications Technology (ICT) solutions. 

To ensure the integrity of cargo the new SARS cargo system is capable of processing both manual and electronic seal data and tracking that through a number of facilities (terminals and depots) as the cargo move through the supply chain.

“In conclusion, these measures will enable us to deal decisively with illegal and counterfeit goods, which contribute to the illicit economy and loss of revenue to the state, said the acting chief officer.”

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24 January 2019 – SARS concerned about tax evasion allegations at commissions of inquiry

Pretoria, Thursday 24 January 2019 – The South African Revenue Service (SARS) has noted media reports on allegations of tax evasion at the various commissions of inquiries that are underway.

SARS is concerned that names of some former employees have been mentioned in alleged wrongdoing and would like to assure the South African taxpayers and public that these will be investigated without fear or favour and guilty persons will be brought to book.

SARS wishes to further assure the taxpayers and public that in instances where tax rules and laws have been violated or undermined, strict measures will be applied to uphold the rule of law.

Also, SARS wishes to reiterate that the newly reconstituted Illicit Economy Unit is already hard at work and will be monitoring the developments closely and are taking the necessary steps where appropriate to ensure compliance with tax laws.

SARS wishes to draw attention to the Voluntary Disclosure Programme that is still fully operational and non-compliant taxpayers and members of the public are encouraged to make use of this facility where appropriate.

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10 January 2019 – SARS customs intercepts rhino horn worth over R23 million

Pretoria, 10 January 2019 – Customs officials of the South African Revenue Service (SARS) intercepted a consignment of rhino horns worth over R23 million at the OR Tambo International Airport (ORTIA) yesterday.

The 36 pieces of rhino horn were found after “Lizzy” a detector dog reacted positively to a consignment of so-called ‘decoration Items’ in a warehouse. Customs officials accordingly cut open eight boxes attached together with bubble wrap. The horns, destined for Dubai, were hid underneath cut laminated wooden sheets in four of the boxes which were otherwise filled with doormats and decorative items.

The total weight of the horns was 116kg, valued at an approximate value of R23 200 000.00. The street value of these horns is assumed to be much higher. 

The inspection at the warehouse formed part of an initiative to increase enforcement activities on cargo for outbound flights, following recent reports that rhino horn, originating from South Africa, has been detected in the Far East. This initiative is continuing.

The South African Police Services (SAPS) and the Directorate for Priority Crime Investigations (HAWKS) were alerted, and a criminal case was registered with SAPS, DPCI (HAWKS) for further investigation.

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11 January 2019 – OECD, SARS and National Treasury continue partnership to strengthen tax co-operation

Pretoria, 11 January 2019 – Today, the OECD, the South African Revenue Service (SARS) and National Treasury of South Africa (National Treasury) signed a Memorandum of Co-operation (MoC), agreeing to continue to work together in the area of taxation. The MoC is in place until December 2023.

The three parties have a long history of collaboration and the MoC provides for the continuation of such co-operation towards the achievement of the common objective of promoting fair and efficient tax systems and administrations, strengthening and modernising international taxation areas through the sharing of experiences between SARS, National Treasury and OECD member countries.

The MoC was signed in Pretoria, South Africa, by Mr. Ben Dickinson, Head of the OECD Global Relations and Development Division at the Centre for Tax Policy and Administration, Mr. Mark Kingon, Acting Commissioner of SARS, and Stadi Mngomezulu, Acting Director-General of National Treasury (signing on behalf of Dondo Mogajane, Director-General of National Treasury).

During the signing ceremony Ben Dickinson said:  “I am delighted we are strengthening our partnership with SARS and National Treasury. We have together delivered successful training events as part of the Global Relations Programmes in the past years and I look forward to expanding our collaboration to blended learning and e-learning in 2019.

“It is through cooperative ventures such as the one we have entered into with the OECD that we can enhance our efforts to collect taxes and strengthen our democracy,” said  Dondo Mogajane, Director-General of National Treasury.

Mark Kingon commented that the OECD–South African collaboration in the areas of Tax Policy and Administration over the past years have been immensely beneficial for all parties involved.

“Extending this by a further five years is therefore the natural thing to do. I am pleased for the continuation of the structured relationship that the MoC with the OECD will provide SARS with, particularly in focusing on a whole-of-government approach to tax administration, as well as further honing the skills of our officials in international taxation”.

For more information, please visit:

MOU OECD-NT-SARS 11 Jan 2018.jpg

National Treasury, SARS and the OECD today signed a Memorandum of Co-operation (MoC), agreeing to continue to work together in the area of taxation. The MoC is in place until December 2023. Signing the MoC at the SARS head office in Pretoria are, from the  left, Stadi Mngomezulu, Acting Director-General of National Treasury (signing on behalf of Dondo Mogajane, Director-General of National Treasury); Mark Kingon, Acting Commissioner of SARS and Ben Dickinson, Head of the OECD Global Relations and Development Division at the Centre for Tax Policy and Administration. ​

  

20 December 2018 – Tax Statistics 2018

 

Pretoria, 20 December 2018 – National Treasury and the South African Revenue Service have published the 11th annual edition of the Tax Statistics.

The 2018 edition provides an overview of tax revenue collections and tax return information for the 2014 to 2017 tax years, as well as the 2013/14 to 2017/18 fiscal years.

In 2017/18, for the first time since the 2008 global financial crisis, tax revenue growth did not exceed GDP growth. Key points in the 2018 edition are:

  • Tax revenue collected amounted to R1 216.5 billion, growing year-on-year by R72.4 billion (6.3%) mainly supported by Personal Income Tax, which grew by R37.0 billion (8.7%):
    • Personal Income Tax (PIT) at 38.1%, Corporate Income Tax (CIT) at 18.1% and Value-added Tax (VAT) at 24.5% in aggregate remain the largest sources of tax revenue and comprise about 80.7% of total tax revenue collections.
    • Despite tough economic conditions in which real and nominal GDP increased by a modest 1.3% and 7.0%[1] respectively, the Tax-to-GDP ratio decreased marginally from 25.9% in 2016/17 to 25.8% in 2017/18.
  • In Chapter 2: PIT, geographic and demographic analysis of the assessments of the taxpayers who had been assessed as at the end of June 2018 showed some interesting results:
    • 2 678 743 (54.7%) of assessed taxpayers were male taxpayers; 2 219 822 (45.3%) were female.
    • 1 331 419 (27.2%) of assessed taxpayers were aged 35 to 44 years; and
    • 1 966 744 (40.1%) of assessed taxpayers were registered in Gauteng, of which 629 113 lived in the Johannesburg Metro and were taxed on an average taxable income of R446 838.
  • Statistics in Chapter 3 regarding CIT reveal that just over 24.2% of the 768 687 companies assessed as at 30 June 2018 for tax year 2016 had positive taxable income. A further 48.3% had taxable income equal to zero and the remaining 27.4% reported an assessed loss;
  • Net VAT collections totalled R298.0 billion and grew by R8.8 billion (3.1%) compared to the previous year. Domestic VAT, which amounted to R336.3 billion and grew by R14.8 billion (4.6%), was the key driver for the aggregate growth in net VAT. Import VAT collections totalled R152.8 billion and grew year-on-year by R3.5 billion (2.4%). VAT refunds totalled R191.1 billion and grew by R9.5 billion (5.2%).
  • Chapter 4 indicates that in 2017/18, 76% of active VAT vendors were companies or close corporations. They contributed 92.0% to Domestic VAT payments and accounted for 89.8% of VAT refunds. Although individuals (sole proprietors) comprised 18.4% of VAT vendors, they contributed 3.1% of Domestic VAT payments and received 1.5% of VAT refunds.
  • After experiencing a decline in collections in 2016/17, Import VAT and Customs Duties showed some recovery in 2017/18, as detailed in Chapter 5. They accounted for 12.6% and 4.0% of the year’s Total Tax Revenue respectively, resulting in a 16.6% aggregate, which was below the 18.3% average over the preceding five years. The share of these taxes to GDP also shrunk to 4.2% from the preceding five-year average of 4.6%, with Import VAT recording 3.2% and Customs Duties at 1.0% for 2017/18.
    • Import VAT from the top 3 contributing economic sectors made up 88.0% of the total, namely the Wholesale and Retail Trade, Catering and Accommodation sector (Tertiary) at 39.6%, followed by Manufacturing (Secondary) at 30.2% and Financial Intermediation, Insurance, Real-Estate and Business Services (Tertiary) at 18.1%.
    • The overall effective Customs Duty rate in 2017/18 was 3.2% compared to previous year’s 3.0%. Key commodities with the highest effective Duty rates were Footwear and Accessories at 22.9%; Hides, Skins and Leather at 18.0%; Textiles and Clothing at 16.0%; Food, Beverages and Tobacco at 11.8% as well as Vehicles, Aircraft and Vessels at 8.2%.
  • Finally, Chapter 6: Other Taxes and Collections provide information about taxes such as Capital Gains Tax (CGT), Transfer Duty, Mineral and Petroleum Resources Royalty (MPRR), Southern African Customs Union (SACU) payments and Diesel refunds. In 2017/18, CGT of R17.6 billion was raised of which R10.0 billion was attributable to individuals and trusts and R7.6 billion to companies. This shows a narrow increase of R0.6 billion (3.3%) on the R17.1 billion raised in 2016/17. An aggregate of R124.8 billion has been raised since the introduction of CGT in October 2001.

The 2018 Tax Statistics documents are available on the SARS and National Treasury website at www.sars.gov.za and www.treasury.gov.za.

SARS and National Treasury welcome public comments and suggestions to continue to enhance the publication’s utility in policy evaluation, and developing new insights in South Africa’s social and economic context. These can be provided via e-mail to taxstatistics@sars.gov.za.

19 December 2018 – SARS Customs busts equate to approximately R90 million

Pretoria, 19 December 2018 – In two separate incidents, the South African Revenue Customs officials intercepted Acetanthranil – a substance used or linked to manufacturing Mandrax – that weighted 1600kg and another 1581kg, respectively, estimated at R90-million at OR Tambo International Airport (ORTIA) in the past two days.

The South African Police Service (SAPS) Forensic Services Laboratory (FSL) confirmed the substance with an estimated street value of R90 million rands.
SARS handed over the consignments to SAPS for further investigations.

In another incident at ORTIA on Friday last week, a consignment of 241 920 Sexual Enhancements Tablets, valued at R24 192 000.00, were intercepted during inspection.  The goods were handed over to Port Health for further investigation.

In Durban early last week, a foreign national who had offered a bribe of R200 000 to a SARS Customs officer appeared in the Durban Specialised Commercial Crime Court. The suspect had intended to use the bribe to have a detained truck and its load of alcohol, Customs & Excise Duties on the alcohol was R1 200 000.00, released.

At the time of the arrest, the suspect was in possession of a false invoice, alleging that the alcohol had been supplied by a Gauteng-based known liquor chain store.
Upon further enquiry, the suspect failed to provide a reasonable explanation or evidence of where the load of alcohol had been obtained. As a result, the officers issued the suspect with a Letter of Intent to seize both the truck and the load.

It must be stressed that while no country is immune to these crimes, SARS, as the agency responsible for revenue collection, will always be a target for criminals. Tackling corruption effectively is imperative for SARS as we continue on our journey to rebuild trust. As such, the Customs officer at Durban who refused the bribe is commended for having headed the call not to be corrupted.

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14 December 2018 – Extension of SARS Acting Commissioner’s term

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