The South African Revenue Service (SARS) is planning a number of large-scale changes to improve its tax collection figures and ensure compliance, including bringing back the Large Business Centre (LBC) and a revamp of the e-filing platform.
These changes follow the revenue agency missing National Treasury’s revised target for 2017/2018 by R700m, while collecting R1.216trn in taxes.
“From the service and compliance [side], we acknowledge losing billions in revenue from the LB (large business) environment. We needed to re-look and reformat it,” Narcizio Makwakwa, acting group executive for relationship management at SARS, told Fin24 by phone.
The 2018/2019 tax season is currently underway. Makwakwa (not to be confused with former SARS executive Jonas Makwakwa, who resigned from SARS in March 2014) said SARS had not yet decided when the changes would be introduced, and that the LBC might not be in the same format it had been previously.
The decision to do away with the LBC took place while suspended SARS commissioner Tom Moyane was at the helm and faced much criticism from tax professionals. The revenue agency denied disbanding the LBC in 2016, insisting that it had evolved.
SARS chucks faxes
SARS will also revamp its e-filing platform, following the lead of some banks, to encourage customers away from coming into physical branches.
“Registration on e-filing has been one of the most complicated things,” Makwakwa admitted, adding that businesses who register on the platform are still asked to fax documents to the revenue agency.
Another project on the cards to improve tax collection involves tracking goods moving across borders, from beginning to end, to make it easier for compliant users to clear customs.
New focus on taxpayers
Makwakwa delivered his presentation about the changes to the revenue agency at a tax conference, hosted by Deloitte Africa in Sandton, last week.
Delia Ndlovu, Managing Director: Africa Tax & Legal at Deloitte, told Fin24: “It looks like they want to bring back the whole focus on taxpayers and treating taxpayers well, which I thought was a good thing.”
After years of negative headlines, and complaints about late refunds, SARS acting commissioner Mark Kingon released a Service Charter on July 2, at the start of the 2018/2019 tax season, outlining taxpayers’ rights and responsibilities as well as service standards they should expect from the agency.
Deloitte Director: Indirect Tax, Severus Smuts said that from what he had seen, there was “definitely a willingness from SARS to be more professional, and a willingness to engage with taxpayers”.
Kingon’s position as acting commissioner looks set to continue, with suspended head Tom Moyane arguing it is unfair that his disciplinary inquiry and the broader inquiry into the tax agency proceed at the same time.
Chairperson of the disciplinary inquiry, Advocate Azhar Bahm, is likely to rule within the new few weeks about the complaint.
The Nugent Commission of Inquiry, which was appointed by President Cyril Ramaphosa earlier in the year to probe governance at SARS, started its work on June 26, and public hearings will resume in August.
Provisional taxpayers using e-filing have until January 31, 2019 to file their returns. SARS’ total target for 2018/2019 is to collect R1.345trn.
Tehillah Niselow. 30 July 2018. Fin24. Sars to revive Large Business Centre, revamp e-filing. Available from https://www.fin24.com/Economy/sars-to-revive-large-business-centre-revamp-e-filing-20180730.