Sars applauds new fiscal commitment

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The South African Revenue Service (Sars) welcomed Minister of Finance Enoch Godongwana’s “unflinching” commitment to fiscal sustainability when he presented the Medium-Term Budget Policy Statement in parliament on Wednesday.

Sars said this would enable long-term growth by narrowing the budget deficit and stabilising debt.

In the FY2021-22, tax revenues are expected to grow year-on-year at 18.9% from the earlier projected growth of 9.2%. This represents tax revenues that are growing at a faster rate than the economy.

Sars continues to focus on its administrative efficiencies and taxpayer compliance improvement in order to ensure heightened tax revenue collection.

According to Sars, revenue collections have been trending well above the estimate set out in the February 2021 budget.

Of this amount, R53.5 billion was collected in cash revenue whilst R33.5 billion was secured through fraud prevention and other leakage protection.

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“The revenue performance at half-year reflects an economy that is recovering almost to pre-Covid times, Sars noted.

However, there are downside emerging risks that need to be managed for the remainder of the year, including energy security (ie load shedding; resurgence of subsequent waves of Covid domestically and globally; drastic adverse changes in global demand of ore and platinum group metals (including exchange rate and commodity price considerations); and supply chain disruption.

It is expected the rate of growth in revenues will outstrip the rate of growth in the economy going into the next 18 months, therefore leading to a tax-to-GDP of 24.1% for the year 2021-22.

“Sars has facilitated more than R2.6 trillion trade with our trading partners in the past year,” Sars Commissioner Edward Kieswetter said.

“As a result, to improve trade facilitation, greater focus and concomitant funding will be crucial going forward in helping us to renew and refurbish ailing infrastructure at our border posts as well as investing in our ICT infrastructure to modernise the Customs landscape towards Smart borders. We remain cautiously optimistic that we will meet the new revenue estimate.”

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“Executing the Sars mandate would not be possible without the continued compliance of taxpayers, traders, intermediaries and other valued stakeholders, who fulfil their legal obligations and do the right thing,” Kieswetter said.

“I wish to thank them for complying. Increasingly concerning are taxpayers and traders who continue to be intentionally and wilfully noncompliant,” he said.

He made a renewed call to defaulters to comply with tax law.

Citizen reporter

Source: citizen