SARS COMMISSIONER DETERMINED TO ACT ON NUGENT REPORT

Cape Town, 17 September 2019 – South African Revenue Service (SARS) Commissioner Edward Kieswetter has told Parliament’s Standing Committee on Finance (SCOF) that SARS has made substantial progress in implementing the Nugent Commission (Commission) recommendations.

Commissioner Kieswetter informed the committee that consultancy firm Bain had paid back the R217-million to SARS.  However, IT consultants Gartner had declined to do the same despite several engagements.

Owing to the way in which these companies conducted their business activities consideration should be given to placing them on a restricted suppliers list which if approved, means they would not be able to do business with the South African government.

Furthermore, where criminal conduct is suspected relating to matters of Bain and Gartner these have been referred to the Directorate for Priority Crimes Investigation (Hawks) for criminal investigation.

In a comprehensive presentation to the SCOF on progress made in implementing the recommendation of the Nugent Commission, Mr Kieswetter also highlighted the following:

The Large Business Centre which was abolished has gone through an organisational redesign and is now functional and will be launched at its new premises in October;

The Illicit Trade Capacity has been re-established in the Enforcement division.  The primary focus of this unit will be on tax relating to Organised Crime, Customs and Excise evasion schemes in the following industries: Tobacco; Cash and Carry; Clothing and Textiles and Alcohol, among other industries.

The Compliance Unit has been re-established to facilitate the development, implementation monitoring and reporting of the compliance policy and risk strategy;

SARS will re-constitute its High Court Litigation Unit, which had been broken up into regional entities, hampering the pace at which the unit functioned and this will be activated in October 2019;

The IT division has been stabilised by temporarily filling key positions with experienced IT professionals;

Re-establish the Integrity Unit which performs an important function within SARS; and

Resourcing of the required critically skilled resources for the IT division will begin later this year.

Regarding the resignation of senior employees, the recruitment policy has been revised to allow for the recruitment of staff that left the employment for various reasons. Employees who were shifted into meaningless roles have all been given meaningful work.

Mr Kieswetter said he was currently conducting performance reviews of EXCO members as required by the Nugent recommendations and as an incoming leader to perform an all-round assessment of leadership capabilities.  Disciplinary proceedings affecting certain individuals are underway. While meetings of the existing EXCO have been put on hold, specific operational meetings on the implementation of SARS’ business are held with the broader executive team on an ongoing basis.

All benefits of EXCO members and appointments without ministerial approval have been submitted to the Minister for review and approval as per Section 18(3) of the SARS Act.

Mr Kieswetter said that from 1 October 2018, SARS no longer applied a monthly VAT refund target to limit the refunds paid in a particular month.   Instead, when a VAT refund becomes payable, it is paid without considering the monthly refund target.

This change in approach has resulted in an additional R30-billion of refunds being paid out in the 2018/19 financial year. 

With regard to legal costs incurred by the former commissioner, Mr Kieswetter said SARS is in the process of recovering the amounts involved including an unauthorized trip to Russia in November 2017 as well as addressing legal costs incurred in seeking advice on the Makwakwa matter.  These costs amount to R2 143 167.42.

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MEDIA STATEMENT

PRETORIA, 02 October 2019 – The Commissioner, Edward Kieswetter has committed to the important work of rebuilding internal and public confidence in SARS. Accordingly, following interactions and information exchanged between SARS and Ms Mmamathe Makhekhe-Mokhuane and Mr Luther Lebelo, respectively, through their legal representatives, it has been concluded that:

• SARS and Ms Makhekhe-Mokhuane and Mr Lebelo, respectively, should, and have agreed to end the employment relationship with immediate effect.
• SARS will not proceed with further actions against Ms Makhekhe-Mokhuane and Mr Luther Lebelo in pursuance of allegations against them respectively. 

SARS wishes them well in their future endeavours.

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MEDIA STATEMENT

The Commissioner of SARS has committed to the important work of building internal and public confidence in SARS. Accordingly, following interactions and information exchanged between SARS and Mr Teboho Mokoena, hitherto the Chief Officer – Human Capital and Development, it has been concluded that:

(a) SARS and Mr Teboho Mokoena should, and have agreed to, end the employment relationship with immediate effect.

(b) SARS will not proceed with further actions against Mr Teboho Mokoena in pursuance of allegations against him.

SARS wishes him well in his future endeavours.

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SARS LAUNCHES RE-ESTABLISHED LARGE BUSINESS CENTRE

JOHANNESBURG, 23 October 2019 - SARS Commissioner Edward Kieswetter launched the re-established Large Business Centre at its new premises in Woodmead today.  Speaking to chief executives of top companies, Mr Kieswetter presented the value proposition that the re-established Centre will offer to bring about voluntary compliance amongst corporate South Africa.

The SARS Vision 2024, introduced by Mr Kieswetter, is to build a smart modern SARS with unquestionable integrity, which is trusted and admired by all stakeholders, as well as its international peers. 

Currently corporate income tax is the third largest revenue contributor, having brought in 16.6% of the total revenue in the 2018/2019 financial year.

Mr Kieswetter identified that the strategic objectives that will drive the Large Business Centre will be a focus on voluntary compliance, effective and efficient revenue collection, and enhancing service and SARS’ relationship with large business.  In addition, the Large Business Centre is to become a centre of excellence that responds effectively to challenges and requirements presented by this complex taxpayer segment and which is aligned to international tax administration best practice.

The value proposition offered by the large business centre is to promote voluntary compliance at the lowest cost to the taxpayer and SARS, with a three-pronged approach consisting of – 

- Dedicated relationship management by industry and sector, ensuring that tax teams allocated to the client has specialised knowledge and understanding of the client’s business.

- A highly skilled and professional team with proficiency on multiple tax types for taxpayers with complex tax portfolios, including those operating in multiple tax jurisdictions.   To this end, SARS aims to facilitate clarity of the taxpayer’s obligations and improve efficiency in assessments, audits and dispute resolution processes.

- Centralised management of the taxpayer’s tax compliance requirements across tax types which SARS’ refers to as a ‘One-stop shop’ end-to-end service. This service provides the taxpayer with seamless interaction with SARS for any tax requirement or query the taxpayer may have, through one relationship management team who manages their entire tax portfolio.

The taxpayer segment that the Centre focuses on is large businesses defined as groups or entities with a turnover greater than R1 billion; are listed on the Johannesburg Stock Exchange; financial services with a turnover greater than R500 million; mining companies with turnover greater than R500 million, all entities or groups of companies with a combined total assets value greater than R100 million, as well as multinational companies.  The other client segment is Ultra High Net-Worth Individuals whose total assets are in excess of R75 Million.  Taxpayers who meet one of these criteria are registered with the SARS Large Business Centre.

The Large Business Centre is situated at the Woodmead North Office Park, 54 Maxwell Drive, Johannesburg.

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MEDIA STATEMENT 15 NOVEMBER 2019

The SARS Commissioner has made the commitment to restore the integrity of SARS and public trust in the institution. In accordance with this and following a disciplinary hearing chaired by a Senior Counsel from the Johannesburg Bar, Ms Refiloe Mokoena, the Chief Officer: Legal Counsel, has been found to have committed serious acts of misconduct. SARS has accepted the chairperson’s recommendation of immediate dismissal and her services have been terminated with effect from today, 15 November 2019.

Source: www.sars.gov.za