/ 7 April 2014

New tax ombud office launched

The newly appointed tax ombud Bernard Ngoepe.
The newly appointed tax ombud Bernard Ngoepe.

Taxpayers who feel like they have been unfairly treated now have a new avenue to air their grievances. The first ever office of the tax ombud in South Africa was officially launched on Monday morning by a smiling Finance Minister Pravin Gordhan, accompanied by the newly appointed ombud, retired judge Bernard Ngoepe.

The tax ombud will act as a "last resort" of complaint for taxpayers who have grievances relating to administrative matters, poor service or the failure by the South African Revenue Service (Sars) to observe taxpayer rights. 

"The tax ombud is an additional and free avenue to deal with complaints by taxpayers that cannot be resolved through Sars's internal mechanisms," said the minister.

Ngoepe stressed his desire for the ombud's office to fulfill a completely independent role, while simultaneously maintaining good working relationships with both the finance ministry, under which the office ultimately falls, and the national revenue service.

"The public needs to understand firstly that we are independent," said Ngoepe. He acknowledged that the extent of the office's independence was contingent on the institutional structure in which it was operating. But the retired judge was clear that they had no intention of taking instructions on how to handle cases from the finance ministry.

"We want to create an institution in which the populace can have confidence … where people can say 'yes, we are paying tax, but we are being fairly treated'," he said.

Ngoepe, who is the chancellor of the University of South Africa, served as the judge president of the high court in Johannesburg. He also spent some time as the acting judge of the Constitutional Court just after the turn of democracy in 1995.

Also present was Sars acting head Ivan Pillay and the chief executive of the new office, advocate Eric Mkhawane.

Pillay underscored his commitment to assisting the ombud's office. "We [at Sars] will do all we can to ensure the tax ombud succeeds," he said. The introduction of the new office is "good for taxpayers" and "good for Sars". The ombud would help to "keep us on our toes", he said.  

Several Sars employees have been seconded to the ombud's office while permanent positions are being sought and filled.

A memorandum of understanding, outlining the roles and interplay between the tax ombud's office, the ministry and Sars is currently being discussed. According to the minister, it will be finalised by about June this year.  

Although the office was officially launched for the "taxpayer public" on Monday, the ombud was already appointed in October as per the Tax Administration Act of 2011.

Feedback from Sars
Between October 1 and March 31, the office has received 673 approaches. Only 9% of those were deemed as actually falling within the ambit of the ombud.

More than 510 of the approaches (76%) were enquiries; the remainder were not valid, or raised by those who had not exhausted their options within Sars before approaching the office. 

Of the 61 legitimate complaints received, 70% have been resolved. The remainder of the cases are still in progress or awaiting feedback from Sars.

Chief executive Mkhawane said that the new office would place an emphasis on efficient turnaround. "We've undertaken to fast-track complaints," he said.

The majority of the taxpayers who have thus far approached the ombud's office have been individuals (62%), while 24% have been tax practitioners. The office can be approached by all tax-paying entities, including businesses.