South Africa

SA Budget 2015: Committee appointed to sort SARS out

By Ranjeni Munusamy & Rebecca Davis 25 February 2015

Finance Minister Nhanhla Nene announced at a pre-Budget media briefing on Wednesday that he had appointed an “advisory committee” into SARS’ governance headed by a retired judge. The objective is for an independent committee to rise above the factionalism currently afflicting South Africa’s embattled tax-collecting body. This welcome news follows months of scandal plaguing the South African Revenue Service involving high-ranking officials. By RANJENI MUNUSAMY and REBECCA DAVIS.

Retired judge Frank Kroon is to head an advisory committee into SARS, Nene said on Wednesday. The decision to appoint Kroon was made in consultation with Minister of Justice and Correctional Services Michael Masutha. More members are to be appointed in due course.

Nene told a media briefing that the committee’s primary task will be to “guide the direction of long-term strategy at SARS”. While the recent controversy involving the operation of a rogue unit is likely to be its primary focus, the committee will also advise the Minister on strategic plans, modernisation of technology, reorganization of business units and relevant budgets.

The past few months has seen SARS plunge into crisis after revelations that the rogue unit had conducted covert intelligence activities outside national legislation. The controversy has seen SARS’ new commissioner Tom Moyane cross swords with deputy commissioner Ivan Pillay and head of strategic planning Peter Richer.

An investigation headed by advocate Muzi Sikhakhane made no findings of wrongdoing against Pillay and Richer, but a number of court battles have ensued between the warring factions.

He said that the committee would review the events that have been reported on by the media in recent months and advise the minister and the commissioner about the best way to prevent their recurrence.

“On this issue, I would like to inform South Africans that there are processes underway to bring about closure on this matter as soon and as amicably as possible,” Nene said.

He appealed to South Africans to allow SARS and all relevant parties to “complete these processes and thus bring an end to this difficult chapter in the history of our most important fiscal institution”.

Addressing journalists, Nene was at pains to stress that SARS has “done tremendously well under the circumstances”, and the Treasury and government’s biggest interest is to “restore the integrity of the institution”.

Committee head Kroon retired as a judge of the Eastern Cape High Court in 2011. One of the landmark rulings he handed down was a judgment in 1986, after the National Party government declared a state of emergency. In the ruling, Kroon determined that the detention of Father Graham Cornelius, who allowed his church to be used for a service marking the tenth anniversary of the Soweto Riots, was unlawful, and ordered the priest’s release.

Kroon also served as a part-time judge of the Labour Appeal Court, the Supreme Court of Appeal, and the Constitutional Court.

Nene’s maiden Budget speech, delivered on Wednesday, stated that tax revenue currently sustains more than 24% of South Africa’s Gross Domestic product. SARS employs over 15 000 people. DM

Photo by EPA.

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