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A competent SARS is at the heart of building a capable state, and finally we have one again

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Oscar van Heerden is a scholar of International Relations (IR), where he focuses on International Political Economy, with an emphasis on Africa, and SADC in particular. He completed his PhD and Masters studies at the University of Cambridge (UK). His undergraduate studies were at Turfloop and Wits. He is currently a Deputy Vice-Chancellor at Fort Hare University and writes in his personal capacity.

After Jacob Zuma appointed Tom Moyane as SARS commissioner, the institution went to the dogs. Now, with SARS under the leadership of Edward Kieswetter, we can again aspire to be a capable state.

Over the years, many people have asked me, “Is everything still okay in our country?” To which I used to glibly reply: “Firstly, the detractors of our transformation project have not yet got their hands on SARS, our tax revenue service, because that would spell disaster for us all, and secondly, the next time you call me to ask that question and I tell you I’m at the airport already, you must know it’s too late.”

Usually, this solicited some uncomfortable giggles until one day the Zuma mafia dug their claws into SARS and appointed Tom Moyane as its commissioner. A person who later was found by our courts to be unfit for that office.

Under Moyane the revenue service went to the dogs. We lost so much ground and every now and again the thought would cross my mind to get myself on to the Gautrain and to the airport. Fortunately, the elective conference of the ANC at Nasrec in 2017 gave me new hope because the Zuma faction was defeated for the time being. Soon after this conference and after then president Jacob Zuma was forced into retirement, our new President, Cyril Ramaphosa, indicated that “restoring stability and credibility in the South African Revenue Service was among my foremost priorities when I was elected President in 2018”.

He went further: “Like a number of other key institutions, SARS had suffered from the ill-effects of State Capture, with political meddling, mismanagement and other factors seriously affecting its efficiency. This had the direct consequence of not only undermining taxpayer morality, but also loss of business confidence in the organisation.

“In 2018, I appointed a commission of inquiry into tax administration and governance at SARS chaired by retired Justice Robert Nugent. The commission delivered its final report by the end of the same year. Four years later, SARS has implemented nearly all of the 16 recommendations and 27 sub-recommendations to restore stability to the organisation. 

“SARS has driven a focused turnaround strategy to position itself at the forefront of efficiency and service excellence. It has a concerted programme to promote tax morality and compliance.”

Today we reap the benefits of such intervention with R1.5-trillion collected. A truly remarkable feat and just in case you thought it was a one-way strategy, SARS has also paid out the highest tax benefits to taxpayers in nearly 25 years.

When interviewed, the current commissioner, Edward Kieswetter, mentioned new systems, technologies, algorithms and the appointment of skilled personnel. All of these, he says, are what contributed to the success of the organisation. I have no doubt that indeed all of these contributed, but the one fact that I think is missing in this equation is leadership.

Besides the fact that Ramaphosa sought out Kieswetter, the SARS commissioner certainly must also take his due. No looking for non-existent rogue units. Nor intimidating employees and instilling a sense of job insecurity. Not wanting to implicate former commissioners in all sorts of supposed wrongdoing and spending time focusing on all the wrong issues instead of sharpening the organisation to secure revenue collection. Inspiring, complimenting and encouraging — these are elements of a good leader. 

Every time I hear Kieswetter talk, be it on radio or television, he always takes time to thank his team, he congratulates, he inspires and that’s a mark of a good leader. When people feel appreciated and due recognition is given, then efficiency and delivery are the order of the day. 

One can only hope that with all the challenges faced by Eskom, the head of that entity will also demonstrate such leadership qualities. Already it is clear to me that much progress is under way at Eskom and I’m certain that in due time we will reap the benefits of such labour.

One of the constraints of some of our neighbouring countries is the fact that they have either no, or very dysfunctional, tax revenue systems in place. They are unable to collect sufficient tax revenue from local businesses and personal income tax from citizens to maintain, rebuild or fulfil their socioeconomic and infrastructural needs. Nor are they in a position to implement some form of social welfare system or provide basic services to their citizens. 

Establishing the South African Revenue Service 25 years ago was the best thing this government could have done — one of the things we got right. SARS is an integral part of the transformation agenda of our country and remains at the heart of building a capable state. It may seem simple, but having the infrastructure to monitor and collect all revenue due, to ensure optimal compliance with tax and customs legislation and border protection, and to facilitate legitimate trade across our borders is no small feat. 

The slogan “your tax matters” is most apt for a country such as ours. Every cent collected by SARS is put to good use by our National Treasury and finds expression in our national Budget allocation. Because of such good tax collection the previous financial year, the finance minister could give many of us reprieves of all sorts, the latest being a much-needed petrol price reduction.

I salute the SARS team and the capable leader and Commissioner Edward Kieswetter for all their efforts. Keep up the good work and always remember, it is through your efforts that we can still aspire to be a capable state.

A state in which the core function is to mobilise resources to meet its developmental challenges and manage long-term social and economic change. A state that values innovation and human capital. One that emphasises economic performance, education, healthcare and infrastructure development. None of which can be obtained if we are not able to mobilise our own resources to do so. DM

 

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  • Whilst increased tax collection is commendable, given the very low base that Mr Kieswetter started operating from, I would argue that any reasonably competent attempt to run a professional organisation would have resulted in increased revenue collection anyway.
    I am very concerned that the Revenue Collector appears to be “celebrating” the 25% increase in revenue collection as well as the record amount refunded to taxpayers.
    Imagine hearing the Traffic Department lauding a 25% increase in the collection of traffic fines, or your Municipality congratulating themselves over a 25% increase in rates collections, so much so that they find themselves embarrassed to the point of having to pay you back?
    The implication couldn’t be clearer. SARS has simply overcollected to the point that it has become an embarrassing exploitation of taxpayers, hence the record refunds. How in the world can this be a good thing, let alone be celebrated?
    Is Mr Kieswetter so out of touch with taxpayers that he doesn’t realise the fatal flaw in this strategy?
    SA taxpayers are still battling to recover from the economic damage caused by Covid-19. SARS has added to their misery through unbridled thievery disguised by promises of the return of these illicitly-gained funds.
    I for one do not buy into this inverted reasoning. Anyone offering s service who finds themselves in a position to return money either didn’t have the requisite knowledge to perform the required service, or simply robbed you.
    You may be happy Mr Kieswetter but I suspect a lot of your abused taxpayers’ feelings are bat the opposite end of the spectrum.

  • So much good sense and truth in your article, Oscar. Its just a pity that you had to include this sycophantic nonsense: “The slogan “your tax matters” is most apt for a country such as ours. Every cent collected by SARS is put to good use by our National Treasury and finds expression in our national Budget allocation”. That is simply not true!

    And by the way, yes, Sars is a hugely improved institution against what it was a couple of years ago, but Sars was NOT established 25 years ago, and it was not established by this government. Let’s not try to re-write history please Oscar.

    Finally, the very fine efforts of Sars and the great results achieved are to be lauded. But the organization is risking its reputation by going just a little too robust. As a practitioner I am receiving dozens of mails from Sars every day, and hardly a day passes without a phone call from debt collection. I am no longer responding to every mail received from Sars, and I have no choice but to ignore some of them because if I don’t, I will spend my entire day dealing with correspondence. Please, Sars, just slow it down a little. You don’t have to collect every last penny immediately!

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