From capture to compliance: the Kieswetter turnaround at SARS

On 1 May 2019, Edward Kieswetter walked into the South African Revenue Service (SARS) with a mandate that was as much moral as it was fiscal.

The revenue authority had been hollowed out by years of governance failure.

Public trust had slipped below 50%. ­Senior leadership posts were vacant. Institutional memory had thinned. Revenue underperformance was no longer cyclical – it was structural.

The Nugent Commission had mapped the damage in forensic detail. The task before the new commissioner was not simply to ­collect more tax. It was to rebuild the ­credibility of the state’s most important fiscal institution.

Six years later, as he prepares to leave office on 1 April, the question is not whether SARS collected a record year somewhere along the line. It is whether the institution itself was rebuilt.

The data suggests it was.

What the numbers show

In his first year at the helm, 2019/20, SARS collected R1.355-trillion in net revenue. It was a modest 5.3% increase on the year before, achieved in an economy growing at just 0.2%. It was not a dramatic turnaround. It was a stabilisation.

That year’s annual report spoke repeatedly of rebuilding leadership integrity, implementing Nugent recommendations and restoring governance systems. Kieswetter described the task as rebuilding the institution into “a smart modern SARS with unquestionable integrity that could be trusted and admired after its capture during 2014 to 2018.”

The emphasis was on integrity first, performance second – because without the former, the latter cannot be sustained.

Crisis without collapse

Then came Covid-19. In 2020/21, as South Africa’s economy contracted sharply under lockdown conditions, many revenue authorities struggled around the world.

SARS collected R1.249-trillion that year, exceeding the revised estimate by R37.5-billion. More revealing than the headline number was compliance revenue: R171.97-billion, well above target. The message was clear. Even in crisis, enforcement discipline would not ease.

In an interview with me at the time, Kies­wetter cautioned against simplistic readings of tax performance.

“There is no straightforward correlation between what happens in the economy and what ends up in the tax coffers,” he said.

“When the minister with the Treasury team models the estimate of taxes, they take into account what’s happening in the economy. They don’t necessarily take into account how taxpayers will behave and what games taxpayers may play or the level of tax morality where people feel confident and justified in paying their taxes.”

Revenue, he argues, is behavioural. Be­­haviour can be influenced. And institutions shape behaviour.

The compliance dividend

Kieswetter often explains compliance in practical terms.

“If a company’s profits are R100, and the tax rate is 28%, the company is liable to pay R28 theoretically. However, that’s the theoretical number. What SARS actually collects is what people or companies disclose… Our job is to assess the difference between the R28 liability and the R20 finally paid over.”

He calls this difference the compliance dividend.

In 2021/22, as the economy rebounded on the back of higher commodity prices and eased restrictions, SARS collected R1.564-trillion – a 25.1% improvement on the year before and 15.3% higher than the last pre-pandemic year.

Compliance revenue climbed to R215.4-­billion. Economic recovery helped. But administrative tightening amplified it. The gap between theoretical liability and actual payments narrowed.

The question at the time was whether this was cyclical luck. It wasn’t.

Building muscle memory

In 2022/23, net revenue rose again to R1.686-trillion. At this stage, the growth was not simply commodity-driven. SARS had begun to embed structural improvements.

In the year to January during one of our many interviews over the years, Kieswetter reported that his offices had worked through nearly 1.4 million outstanding debt follow-up cases.

“More than R60-billion has been collected just through following up on outstanding debt cases,” he said proudly.

That was administrative grind, not economic windfall.

On the criminal front, SARS pursued hundreds of fraud-related investigations. In earlier interviews he detailed seizures of illicit tobacco, assessments raised on undervalued imports and convictions secured through cooperation with the National Prosecuting Authority.

“We leave no stone unturned,” he said of illicit trade investigations.

The enforcement message hardened over time. “Crime and corruption and illicit trade is not a SARS problem – it is a South African problem,” he once told me. “SARS is just one agent doing what it can to solve the problem where it can.”

The birth of a digital SARS

Though enforcement has been a keystone in Kieswetter’s tenure, he also ushered in an era of modernisation.

At a lunch with the Financial Sector Conduct Authority recently, Nolwazi Hlophe, a senior fintech specialist and a key member of the Intergovernmental Fintech Working Group, told me that SARS was the undisputed leader in the use of AI among government departments.

Auto-assessments expanded dramatically. Data analytics and machine learning became embedded in risk engines. Refund verification systems tightened, balancing speed with scrutiny.

In 2023/24, SARS collected R1.741-trillion in net revenue, exceeding the revised estimate by R9.5-billion. Compliance initiatives contributed R261-billion in that year alone.

Refunds tell another story. SARS disbursed R413.9-billion in refunds in 2023/24, including R266-billion in VAT refunds. Yet verification processes halted R95-billion in impermissible refunds that same year. Kieswetter has defended verification vigorously.

“When it comes to fraud and corruption, we will take the time to investigate,” he told me. “Preventing fraud and saving the country money justifies the work we do.”

Another way to look at it is that the irritations taxpayers experience are often the guardrails of the fiscus. And, ultimately, the fiscus is meant to work for the taxpayers.

Sustained performance in a weak growth environment

By 2024/25, economic growth had slowed again to 0.4%. Structural inefficiencies, energy instability and logistics bottlenecks constrained output.

Yet SARS delivered R1.855-trillion in net revenue, exceeding the revised estimate by R8.9-billion. Compliance revenue reached R304-billion.

Viewed from 2019 to 2025, net collections increased from R1.355-trillion to R1.855-­trillion – an increase of roughly R500-billion in annual net collections.

Compliance revenue nearly doubled over the period. And South Africans were noticing the difference.

Trust returns

One of the least discussed but most important metrics of Kieswetter’s tenure is public trust. Internal surveys show trust rising from below 50% in 2019 to higher than 75% by 2024.

Trust is not a soft indicator. SARS collects more than 90% of government revenue. Voluntary compliance depends on legitimacy.

In his commissioner’s overview, Kieswetter wrote: “The story of SARS is a story about hope: everything we do is about having a transformational impact on the wellbeing of the lives of people, especially the most vulnerable among us.”

Taxation, in his framing, is not extraction. It is participation in a social contract.

When people believe the system is fair and competently administered, voluntary compliance strengthens. When institutions falter, compliance erodes.

Taking on the world

Under Kieswetter, SARS also positioned itself firmly within global tax reform debates.

He has explained the global minimum tax bluntly: if multinational companies manage to reduce their effective rate below 15% (to, for example, 12%), “we will levy an additional 3% to make sure the minimum tax rate of 15% is paid”.

South Africa’s global minimum tax legislation has already been enacted and is in force. The Global Minimum Tax Act and the Global Minimum Tax Administration Act were passed in late 2024 and early 2025.

Under these rules, large multinational enterprises that operate in multiple jurisdictions must pay at least 15% effective tax in each jurisdiction, and SARS administers the top-up tax where necessary.

The Budget and related SARS guidance show that the first major compliance timelines for GloBE reporting (the annual disclosure multinational groups submit to show whether they pay at least 15% effective tax in each country) and registration are this year.

GloBE (Global anti-Base Erosion) refers to the core rules of the OECD/G20 global minimum tax regime.

The rollout of GloBE registration and notification functionality on SARS eFiling has been rescheduled to 16 March this year to allow taxpayers and the tax authority to be ready.

Base erosion and profit-shifting are not theoretical concerns. They are fiscal realities in a digital economy. Modernisation, in this sense, is defensive and protects the tax base in a borderless world.

The measure of a commissioner of note

Kieswetter’s leadership style is not flamboyant. In interviews, he consistently redirects praise.

Additional revenue, he insists, is the result of staff “simply doing what the revenue authority is supposed to do”. He credits the more than 12,000 employees under his watch and speaks often of higher purpose.

“We stand or fall by character and quality of leadership and the calibre of our people,” he wrote in one annual report.

That is not a rhetorical flourish: institutional decay begins at the top.

His legacy

Over six years, SARS weathered a pandemic, civil unrest, energy crises, global inflation shocks and structural stagnation, and still delivered rising collections.

Revenue is oxygen for a state grappling with debt stabilisation, social grants, infrastructure backlogs and climate adaptation.

By strengthening compliance, tightening enforcement and embedding digital systems, Kieswetter’s SARS enhanced fiscal capacity at a time when South Africa needed it most.

When he walks out of the SARS office for the last time on 31 March, he leaves behind:

• Higher annual net collections
• Stronger compliance enforcement
• Expanded use of AI and data science
• Reduced refund leakage
• Restored governance structures
• Improved public trust

From fragile to functional; from functional to formidable.

On 1 April, there will be no dramatic farewell. Just an institutional handover.

But in the arc of South Africa’s fiscal history, Edward Kieswetter’s six years will probably be remembered not for a single record-breaking figure, but for something more durable: he rebuilt the machine.

And in a country where institutional repair is rare and precious, that may be his most significant legacy. DM

This story first appeared in our weekly DM168 newspaper, available countrywide for R35.