Nene: Ramaphosa dealing with Moyane suspension

Finance Minister Nhlanhla Nene said on Tuesday President Cyril Ramaphosa is dealing with the suspension of former SARS commissioner Tom Moyane, who left the agency last month under a cloud.

“The issue of Moyane is being dealt with by the president … I hope it would be finalised expeditiously,” said Nene during the announcement of tax agency’s preliminary revenue collection results.

The South African Revenue Service collected R1.216-trillion in tax income revenue for the 2017/2018 financial year, R0.7-billion less than the forecast announced in the February budget.

Nene said the slower recovery of consumer confidence had resulted in lower domestic value-added tax collection, “as more people reduced spending and debt”.

“As a result, domestic VAT grew at a muted level of 4.5%, well below the 8.1% growth seen in the previous year,” he said.

“More concerning, though, is the increasing tendency of business to withhold taxes such as VAT and PAYE, collected on behalf of SARS,” said Nene.

Personal income tax accounted for the largest contribution of revenue collection at R462.5-billion, followed by VAT at R297.8-billion, while company tax and customs added R220.2-billion and R49.4-billion respectively.

The preliminary figures are still subject to final audit.

Nene, who was named finance minister in President Cyril Ramaphosa’s maiden Cabinet in late February said the new VAT hike, which came into effect on April 1, is expected to raise an additional R22.9bn in 2018/19.

The VAT increase from 14% to 15% was the first since 1994.

Nene stressed the role of SARS in the economy, saying 90% of the budget is financed through revenue collected by the agency.

“This massive contribution forms the basis of our fiscal framework and is critical in consolidating our sovereign debt,” he said.

“SARS has seen a deterioration in compliance as indicated by the overall growth in outstanding returns across all taxes,” according to a statement.

The tax agency said it has boosted its outstanding returns campaign to address the challenge, with over 1 million calls made by SARS agents to collect outstanding fees.

The organisation has suffered reputational damage in the past years amid a purging of high-ranking officials, with allegations of political interference in its operations.

In March, President Cyril Ramaphosa suspended SARS boss Tom Moyane, saying he had lost confidence in his ability to lead the agency.

Acting commissioner Mark Kingon, who assumed the position after Moyane’s suspension, said the agency has “gone through some pain in the past, but remains a solid organisation”.

“Our focus going forward is to restore credibility and, in particular, our relationship with the taxpayer,” said Kingon.

He said beefing up the capacity of SARS would require a skilled workforce, noting that the institution is losing employees with critical skills to the private sector. — Fin 24

These are unprecedented times, and the role of media to tell and record the story of South Africa as it develops is more important than ever. But it comes at a cost. Advertisers are cancelling campaigns, and our live events have come to an abrupt halt. Our income has been slashed.

The Mail & Guardian is a proud news publisher with roots stretching back 35 years. We’ve survived thanks to the support of our readers, we will need you to help us get through this.

To help us ensure another 35 future years of fiercely independent journalism, please subscribe.


‘Tenderpreneurs’ block the delivery of protective equipment to schools

Protests by local suppliers have delayed PPE delivery, which according to the DBE, is one of the reasons the reopening of schools has been pushed back until June 8

‘Soon he’ll be seen as threatening, not cute’: What it’s...

There is no separating George Floyd’s killing from the struggles black people have faced ever since the first slave ships landed on these shores

How schools could work during Covid

Ahead of their opening, the basic education department has given schools three models to consider to ensure physical distancing

Press Releases

Mining company uses rich seam of technology to gear up for Covid-19

Itec Direct technology provides instant temperature screening of staff returniing to the workplace with no human contact

Covid-19 and Back to School Webinar

If our educators can take care of themselves, they can take care of the children they teach

5G technology is the future

Besides a healthcare problem Covid-19 is also a data issue and 5G technology, with its lightning speed, can help to curb its spread

JTI off to court for tobacco ban: Government not listening to industry or consumers

The tobacco ban places 109 000 jobs and 179 000 wholesalers and retailers at risk — including the livelihood of emerging farmers

Holistic Financial Planning for Professionals Webinar

Our lives are constantly in flux, so it makes sense that your financial planning must be reviewed frequently — preferably on an annual basis

Undeterred by Covid-19 pandemic, China and Africa hold hands, building a community of a shared future for mankind

It is clear that building a community with a shared future for all mankind has become a more pressing task than ever before

Wills, Estate Administration and Succession Planning Webinar

Capital Legacy has had no slowdown in lockdown regarding turnaround with clients, in storing or retrieving wills and in answering their questions

Call for Expression of Interest: Training supply and needs assessment to support the energy transition in South Africa

GIZ invites eligible and professional companies with local presence in South Africa to participate in this tender to support the energy transition

The best local and international journalism

handpicked and in your inbox every weekday