14 March 2018 – Mark Kingon appointed as Acting Chief Officer – BAIT

PRETORIA, 14 MARCH 2018 – The South African Revenue Service (SARS) has appointed Mr Mark Kingon as acting Chief Officer: Business and Individual Taxes (BAIT) following the resignation of Mr Jonas Makwakwa this morning.

Mr Kingon has been with SARS for close to 34 years. He is currently the Group Executive: Relationship Management within BAIT.

Mark is a respected senior executive who has risen through the ranks of the organisation, having worked in enforcement and in the legal department of SARS, amongst others.

He is also widely respected within the broader professional tax community.

SARS has full confidence in the abilities of Mr Kingon to manage this new additional role as we continue with our absolutely important mandate of collecting all revenue due to the fiscus to fuel our country’s growth and development.

13 March 2018 – SARS pledges to open Makwakwa reports

CAPE TOWN Tuesday 13 March 2018 – The South African Revenue Service has pledged to submit the Hogan Lovells Report and the Advocate Terry Motau Disciplinary Hearing Report to the Standing Committee on Finance on Friday, 16 March 2018. This was after Mr Makwakwa wrote a letter to the Commissioner authorising him to submit the said report.

In a significant development, it must also be noted that Jonas Makwakwa has agreed that details and information on his personal tax affairs related to the investigation on this matter be divulged and shared with the Finance Minister, Nhlanhla Nene, SCOF Chairman, Yunus Carrim and members of his committee.

SARS recently wrote to the SCOF Chair to convene a panel of legal experts to advise Parliament, Financial Intelligence Centre and SARS to find legal counsel on the matter.

SARS Commissioner Tom Moyane read directly from an 11 March 2018 letter submitted by Makwakwa where he conceded that his tax audit reports can be shared with the Minister and SCOF.

SARS has also noted media reports about the alleged link between Makwakwa and NCIS, one of the 8 agencies appointed through a legitimate procurement process for debt collection of over R16.6-billion of outstanding debt owed to SARS.

SARS will immediately investigate the matter for a speedy and concise resolution of the matter.

In fact, SARS views this allegation in a serious light and will immediately investigate the matter. SARS wishes to state that should any wrong doing be found on the said allegations, SARS will act swiftly, without fear or favour.

SARS’ 14000 men and women remain focused and highly energised to reach their reviewed revenue target of R1.217-billion before the end of March 2018, difficult as it may be.

SARS wishes to reiterate that this development marks a significant turning point that will contribute to the speedy resolution of the matter.

SARS appoints debt collectors to recover R16.6-billion owed

Pretoria, 09 March 2018 – The South African Revenue Service (SARS) has appointed eight debt collection agencies to recover as much as possible of the R16.6-billion in debt owed to SARS.

The objective is to boost revenue collection by outsourcing the recovery of older and relatively small amounts due to SARS. The contract takes effect immediately and will run until 28 Feb 2019.

At present, over 2.3 million taxpayers and traders owe SARS just under R150-billion.

The agencies that have been appointed are, CSS Credit Solution Services (Pty) Ltd, ITC Business Administrators (Pty) Ltd, Medaco Capital Services (Pty) Ltd, New Integrated Credit Solutions (Pty) Ltd, Norman Bisset & Associates Group (Pty) Ltd, Revenue Consulting (Pty) Ltd, Transactional Capital Recoveries (Pty) Ltd and Van De Venter Mojapelo (Pty) Ltd.

Taxpayers and traders with outstanding accounts will only be contacted, via electronic channels. The agencies will embark on the traditional debt collection activities, including outbound calls; tracing of taxpayers, sending out notices (can be SMSs, emails or letters/notices).

Under no circumstances should  debtors pay money directly to the debt collection agency. All outstanding taxor duties must only be paid directly to SARS via authorised payment channels.

The debt collection agencies have also been tasked with encouraging non-compliant taxpayers to submit their outstanding returns to SARS so as to avoid the imposition of any further interest or penalties and criminal charges. SARS invites all taxpayers to please co-operate with the service providers above. Failure to do this could result in criminal prosecution.

The revenue collected by SARS is vital for fuelling the growth and development of our country and assisting SARS to achieve its tough target of R1.217 trillion. Compliant taxpayers who pay their dues should be justifiably proud that they contribute to this national agenda as responsible citizens.

SARS thanks these taxpayers and is committed to improving its service to the taxpaying public while introducing measures to make it easier for all taxpayers to comply with their fiscal obligations.

Those with queries are encouraged to contact the SARS Contact Centre at 0800 00 7277 (0800 00 SARS), or visit Owing SARS Money webpage to validate the agencies’ mandate to engage them. 

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8 March 2018 – SARS reaches R3,3-billion mark in SVDP

Pretoria, 08 March 2018 – The South African Revenue Service (SARS) is pleased to announce that under the Special Voluntary Disclosure Programme (SVDP), non-compliant taxpayers with unauthorised foreign assets and income have to date entered into agreements with SARS to the value of over R3,3-billion in tax liabilities.

In terms of the agreements reached, these taxpayers have already paid over R2,7-billion to SARS and the Revenue Service expects another R580-million to be paid by the end of March.

The R3,3-billion includes agreements to pay SARS following information contained in the “Panama Papers”.

SARS is encouraged by the fact that more than 759 high net worth individuals have made use of the normal VDP programme since 2012 and that during the SVDP period, 195 high net worth individuals applied. 

The SVDP was announced in the Budget Speech in 2016 by the Finance Minister to give non-compliant taxpayers the opportunity to voluntary disclose unauthorised offshore assets and income.

These taxpayers had a limited window period running from 1 October 2016 to 31 August 2017 to voluntary disclose tax and exchange control defaults specifically in relation to offshore assets.

However, those taxpayers who missed the SVDP can still make use of the normal VDP process to voluntarily regularise their tax affairs.

According to SARS spokesperson, Sandile Memela, the R2.7 billion revenue already collected under the SVDP is a welcomed boost to SARS’ revenue collection efforts as it strives to achieve its upward revised target of R1.217 trillion, which arises under very difficult economic conditions.

“This revenue will go a long way in adding much value to the state’s revenue needs. Our successes under the SVDP are also a signal to other non-compliant taxpayers to talk to SARS before we talk to them,” he said.

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5 March 2018 – SARS search and seizure operations are strictly governed

PRETORIA, 5 MARCH 2018 – The South African Revenue Service (SARS) is concerned about recent reports in the media of people purporting to be SARS employees entering premises of taxpayers to seize equipment, allegedly as part of a lifestyle audit.

These persons who committed this crime were not SARS officials and their actions are unequivocally condemned.

SARS officials do use search and seizure operations to obtain evidence if there are reasonable grounds to suspect non-compliance or tax crimes.  However, a search and seizure operation by SARS is a criminal investigations tool and is not used to conduct lifestyle audits.

SARS wishes to reassure citizens that search and seizure operations conducted by SARS officials are conducted in a transparent way and in accordance with strict legislation and procedures.

Such operations are often conducted with the assistance of other law enforcement agencies, such as the South African Police Service (SAPS).

A  search and seizure operation by SARS officials requires a judge or magistrate to issue a warrant of execution. The warrant is based on reasonable grounds that the operation would provide evidence to prove suspected transgressions.

The application for the warrant must clearly spell out if evidence is likely to be found on the premises specified in the application. The information supporting the application must be provided under oath or solemn declaration.

If a warrant of execution is issued, it must contain an explanation of the suspected failure to comply or offence; the name(s) of the suspects; the addresses of the premises to be searched, as well as an explanation that material relevant to concluding the case is likely to be found on the premises.

A warrant must be executed within 45 business days, but can be extended if a judge or magistrate deems it appropriate.

The warrant must be provided to the relevant person before the search and seizure operation can proceed. It allows a SARS official to remove documents, equipment, computers or even moveable assets such as a vehicle, aircraft or a vessel. Failure to produce a warrant entitles a person to refuse access to the officials wishing to enter the property.

In exceptional cases a search may be conducted without a warrant, if a senior SARS official believes evidence may be removed or destroyed. This can only happen if the owner or person in control of the premises gives consent.

SARS is aware of fraudsters deploying a range of deceptions to scam unsuspecting citizens. The identity of any person claiming to be from SARS can be verified by contacting the SARS Contact Centre on 0800 00 7277.

28 February 2018 – SARS pays over R205-Billion in refunds

Pretoria, Wednesday 28 February 2018 –The South African Revenue (SARS) has paid over R205-billion in refunds across all tax types in the past 10 and a half months.

The amount of R205-billion paid in refunds is more than the total budget allocated for defence, public order and safety in 2017, which amounted to R198.7-billion.

This massive R205-billion payout to individuals and companies, from the beginning of the financial year on 1 April 2017 to 9 February 2018, represents a significant boost to the economy given the current economic climate.

The R205-billion paid out by SARS can be broken down as follows:

  • Value-added tax (VAT): An amount of R170.2 billion has been paid so far this year. This is a 6% increase compared to R160.6 billion paid last year at the same time.
  • Personal income tax (PIT): An amount of R24.1-billion has been paid so far this year. This is a 16% increase compared to the R20.7 billion paid last year at the same time.
  • Company income tax (CIT): An amount of R11.4 billion has been paid so far this year. This is a 5% increase compared to the R10.9 billion paid last year at the same time.

It must be noted that there has been an increase in refund pay-outs across all tax types in the last three years.

VAT refund payments increased from R162.1 billion in 2014/15 to R167.1 billion in 2015/16 and R181.5 billion in 2016/17.

PIT refund payments increased from R20.5 billion in 2014/2015 to R20.8 billion in 2015/2016 and R23-billion in 2016/2017.

CIT refund payments totalled R10.8 billion in both the 2014/2015 and 2015/2016 financial years. It increased to R13 billion in the 2016/2017 year.

While SARS takes great care in paying legitimate refunds to compliant taxpayers it also has the responsibility to clamp down on fraudulent claims.

Since the beginning of the current financial year on 1 April 2017, SARS has stopped refund fraud across all tax types of more than R28-billion.

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28 February 2018 – Trade Statistics for January 2018

Pretoria, 28 February 2018 – The South African Revenue Service (SARS) today releases trade statistics for January 2018 recording a trade balance deficit of R27.66 billion. These statistics include trade data with Botswana, Lesotho, Namibia and Swaziland (BLNS). The year-to-date (01 January to 31 January 2018) trade balance deficit of R27.66 billion is a deterioration on the deficit for the comparable period in 2017 of R11.28 billion. Exports year-on-year grew by 0.5% whilst imports for the same period showed an increase of 18.3%.

26 February 2018 – SARS reaches R1-trillion milestone

PRETORIA, 26 February 2018 – The South African Revenue Service (SARS) is pleased to announce that it has crossed the psychological threshold of the one-trillion rand mark in its revenue collection efforts.

The one-trillion rand mark was reached on Thursday 22 February 2018, making it the third year in a row that SARS reached this milestone. 

Announcing this milestone, SARS Commissioner, Mr Tom Moyane, said the achievement was testament to the organisation’s commitment to reaching the increased revenue target of R 1.217-trillion, which was announced by the Minister of Finance in his Budget Speech on Wednesday.

The Commissioner said he was confident that the SARS revenue management structures and the entire staff in all regions of the country would deliver the revenue needed by South Africa.

“We are focused on closing all revenue leakages through non-compliance and our staff will spare no effort in reaching the revenue target by 29 March, even though the economy is not performing to our expectations,” Mr Moyane said.

“We believe that our efforts will provide government with the requisite fiscal space to free up resources for its developmental objectives while allowing it to better manage the levels of debt we are facing,” said the Commissioner.

23 February 2018 – Illegal abalone worth R2.3-million seized in Durban

Pretoria, 23 February 2018 – A sting operation at the port of Durban by SARS Customs officials and the Hawks has led to the seizure of 1.6 tons of illegally harvested frozen abalone valued at R2.37 million.

The Durban sting operation was initiated after the Hawks had seized illegally harvested abalone from a container in Port Elizabeth earlier this month. 

Based on the intelligence from the Port Elizabeth bust, a ship travelling to Sri Lanka was ordered to return to South Africa and arrived in Durban earlier this week.

A suspicious container was removed from the ship and inspected after two SARS Customs sniffer dogs indicated the possible concealment of endangered species products in the container.

The container was found to contain 156 boxes of frozen abalone to the value of R2.37 million hidden amongst other items.

The frozen boxes of abalone were handed over to the Department of Agriculture, Forestry and Fisheries (DAFF) and the Hawks for further investigation.

20 February 2018 – Over R18 million worth of crystal meth nabbed at ORTIA

Pretoria, 20 February 2018 – Customs officials of the South African Revenue Service (SARS) made two drugs busts at OR Tambo International Airport this past week seizing crystal meth valued at over R18 million.

On Saturday SARS Customs officials were conducting a baggage scan of a male passenger who had arrived in South Africa from Nairobi, Kenya.

They noticed suspicious objects in his three bags and conducted a further search, subsequently discovering 12 plastic bags containing a white powdery substance.

Drug tests confirmed that the substance was crystal methamphetamine valued at R17 202 000. The drugs and the passenger were handed over to the South African Police Service for further investigation.

In a separate incident on Friday, SARS Customs officials found a parcel which was destined to Malaysia via courier. The parcel was declared as “gifts” but on closer inspection, officials discovered sachets containing a white crystal substance. A drug test confirmed it was crystal meth, valued at just under R1 million. The case was also handed over to the SAPS.