The South African Revenue Service (SARS) collection rates have once again recorded positive growth, collecting a gross R1.55 trillion in the past year.
Addressing Parliament on Tuesday, SARS Commissioner Edward Kieswetter that this comprised of a net of R1.25 trillion of the revenue estimate and that is R38 billion more than the revised estimate.
Refunds paid amounted to R300.6 billion, which is R20 billion more than 2019/2020.
He said: “Our specific compliance interventions to detect and deter non-compliance yielded R172 billion, which shows room to improve compliance levels across all tax types”.
This dovetails with SARS’ strategic objective of making it costly for those who are willfully non-compliant.
He said SARS was encouraged by the measured progress in rebuilding SARS as an institution transforming itself into a SMART Modern SARS.
In addition, R38.9 billion had been granted in COVID-19 relief measures and trade to the value of R2.6 trillion had been facilitated in accordance with the SARS mandate.
He confirmed that tax compliance levels were under strain, with a composite compliance level of 62.61%, compared to the previous year of 65.05%. The Public Confidence Survey point to favourable preference of tax morality but that has not seen an appreciable rise in compliance.
He said the tax base was broadening with 1.6 million taxpayers added to the SARS tax register that resulted in R4.6 billion added to the net collections for the year under review.
“Our strategic objective to make it easy and simple for taxpayers to comply has also yielded impressive results: 86.3% of SARS interactions done through digital channels such as eFiling and the MobiApp”.
The Commissioner warned however that the impact and prevalence of corruption and waste was not helpful in enhancing tax morale within society.
“In addition, 83.2% of standard taxpayers (3.4 million taxpayers) had received auto-assessments based on third party data available to SARS. All taxpayers needed to do was to click accept or edit.
“The effectiveness of these channels are also indicated by the fact that R1.55 trillion was collected via eFiling,” he said.
Accredited Economic Operator (AEO) programme
The SARS Commissioner said that in the Customs space the Accredited Economic Operator (AEO) programme granted 132 participants Preferred Trader status.
“Frontline interventions for Preferred Traders dropped by 22% in this period; 5.6 million Customs declarations were processed under 10 seconds which is 95% of declarations; while inspection times were reduced from 109 hours to 44 hours. Customs seizures amounted to R2.7 billion.”
SARS’ said its enforcement efforts were also yielding results in a difficult and challenging terrain.
“These efforts recovered R147 million from PPE fraud and there was a conviction rate of 96% rate through collaboration with the NPA. The organization is also working with all other enforcement agencies as well as other government agencies,” the revenue collector said.
High Wealth Individual Segment
It said its newly launched High Wealth Individual Segment had written 1400 direct letters to wealthy individuals and 275 had already been reviewed.
“Equally, SARS has also detected 26 000 unregistered taxpayers who have financial assets with economic activity in excess of R1m,” SARS said.
A focus area has been the compliance levels of the various segments, such as Employers; SMME; Large Businesses & International and High Wealth Individuals. In addition, compliance levels of tax products such as PAYE, CIT has been a concern, and SARS has embarked on focused programmes to address this trend.
Modernization programme
The Commissioner said “in order to deliver on its comprehensive programme and despite the financial constraints, SARS is investing 3% of its budgeted resources in its modernization programme so that it can remain abreast in a fast changing technology space”.
Kieswetter expressed his heartfelt appreciation to SARS staff for their “inestimable support in discharging the organisation’s mandate”.
He apologised to taxpayers who may have been unable to transact with the organization due to system challenges.
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