Dissing SARS 'sinks economy'

29 March 2017 - 09:30 By LINDA ENSOR
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Unwarranted attacks on the SA Revenue Service could sabotage the economy and result in lower tax compliance, commissioner Tom Moyane warned in parliament yesterday.

Any loss of confidence in SARS would jeopardise the achievement of tax collection targets for 2016-17, Moyane said in a briefing to the standing committee on finance about the taxman's quarterly performance to end-December.

Moyane said frequent negative comments about SARS in the media were extremely damaging to the service as an institution.

They portrayed an inaccurate picture, insinuating that the organisation was falling apart, he said.

If revenue collection was compromised, it would damage the country.

The "onslaught" was beginning to have a negative effect on taxpayers' confidence in the tax system.

"We are seeing the beginning of a trend where tax compliance levels are beginning to deteriorate.

"We are already contending with dire local and global economic conditions that impact on our economy and our revenue collection ability. The drop in confidence in SARS is clearly noticeable," he said.

The economic downturn had required a revision of the tax revenue target for the year and was not due to SARS's lack of capability.

Revenue collection by end-December of R818.8-billion represented a surplus of R500-million on the target set out in the medium-term budget policy statement, but the surplus would be consumed by the payment of backlog tax refunds, SARS told the parliamentary committee.

The surplus was expected to become a deficit due to refunds, the tax authority said in a submission.

"The saving in VAT refunds was depleted when the December 2016 backlog was cleared in January 2017, thus posing a downside risk to overall revenue collections," it said.

VAT refunds amounted to R133.4-billion by end-December.

- TMG Digital

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