Just before we bid goodbye to 2023, SARS published a media statement on 29 December,
stating that the tax administration collected R2.07 trillion in gross tax revenue (9.7% more
than in 2022). Despite the country’s weaker economic growth, this was mainly achieved
through enforcing compliance revenue secured from focused activities, broadening the tax
base and higher-than-average commodity prices.
The largest sources of tax revenue remain Personal Income Tax (PIT) at 35.7%, followed by
Value-added Tax (VAT) at 25.0% and Corporate Income Tax (CIT) at 20.6%. The fuel levy,
together with specific excise and customs duties, accounted for 12.4%, while other taxes
made up the remaining share of 6.3%.
SARS stated that its strategic principles are to make taxpayers aware of their obligations, make it easy to meet them, and importantly, to act against those that break the law.
The increased effort by SARS is known to include aggressive tax-debt collection actions, a focus on outstanding returns, audit and criminal investigations, detection of fraud, and to stop impermissible refunds, just to name a few. This is done by using sophisticated data science, artificial intelligence to detect non-compliance and reliance on information from third party data sources (domestic and international).
Over the years, tax policies and the imposition of taxes have been developed primarily to
raise essential revenue with the purpose to address domestic economic and social concerns
in South Africa, but more specifically to act for the public good. An appropriate saying on
taxes with a long history and sentiment in the United States, is that “taxation is the price
which we pay for civilization, for our social, civil and political institutions, for the security of life and property, and without which, we must resort to the law of force.”
2024 may be the year to hold the elected representatives accountable for the economy,
efficiency, and effectiveness of service delivery and hold the (compulsory) non-tax paying
voters responsible by combatting instances of irregularities resulting from non-compliance,
fraud, theft, or breach of fiduciary duty, which influence law-abiding South African taxpayers’
attitudes towards tax compliance.
Having said that, this year taxpayers that are not tax-compliant are reminded to seek
professional assistance early to prevent falling prey to SARS’ audits, investigations, criminal
actions, penalties, and interest.
BH Groenewald
The SGN Team
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