Kieswetter’s massive payday – earning three times more than Ramaphosa

In South Africa, the President holds the highest office in the land yet is not the best-paid government official.

This distinction goes to Edward Kieswetter, the Commissioner of the South African Revenue Service (SARS), who recently earned nearly three times more than President Cyril Ramaphosa.

Kieswetter’s total remuneration for the year was R11.71 million, which included a base salary of R7.79 million, performance bonuses of R3.63 million, allowances of R1.56 million, and pension contributions of R1.3 million.

His substantial earnings highlight the relatively high compensation levels in the public service, a point often criticized given South Africa’s struggles with service delivery, economic inequality, and a high unemployment rate.

This disparity in public sector pay has sparked conversations across various sectors of South African society.

Political analyst Moeletsi Mbeki commented that South Africa’s public sector is among the highest-paid in the world when measured against Gross Domestic Product (GDP) despite the country grappling with significant social and economic challenges.

South Africa consistently ranks as one of the most unequal societies globally and has one of the highest unemployment rates, further accentuating the impact of high government salaries on public perception and budgetary strain.

Within this context, Kieswetter stands out as the top-paid government official, outpacing not only the President’s salary but also that of other high-ranking officials.

The second highest-paid public official is South African Reserve Bank (SARB) Governor Lesetja Kganyago, who earned R8.8 million during the 2022/23 financial year.

When comparing overall remuneration packages, several other government officials, including Kieswetter and Parliament CEO Xolile George, also earn well above President Ramaphosa’s annual salary of R4.2 million.

This gap in compensation underscores the complexities of salary structures within the South African government, particularly in the wake of public scrutiny over government spending and economic disparities.

Kieswetter’s significant compensation is largely tied to SARS’ impressive performance in the 2023/24 fiscal year.

According to the SARS annual report, gross revenue collected for revenue service was R2.155 trillion, an increase of R87 billion from the previous year.

After disbursing R413.9 billion in refunds, SARS achieved a net revenue collection of R1.741 trillion, which exceeded its revised estimates by R9.5 billion—a 3.2% growth from the previous fiscal year.

This financial success can be credited to a range of compliance measures that SARS has put in place to curb tax evasion and enhance revenue collection.

The agency’s targeted compliance programs were particularly effective, generating R260.5 billion by focusing on both individual taxpayers and corporations.

SARS’ strategy relied heavily on voluntary compliance, which rose slightly to 63.63%, and further emphasised building trust among taxpayers through enhanced digital service capabilities.

Digital interactions accounted for 88.5% of taxpayer engagements, illustrating the agency’s shift towards online services.

These digital platforms have not only improved accessibility but have also streamlined processes, making it easier for taxpayers to remain compliant.

Moreover, SARS has intensified its efforts to address tax evasion through high-profile audit cases and litigation, resulting in R47.7 billion in assessments from large businesses.

Customs enforcement also ramped up, with goods seizures totalling R6.7 billion, a significant jump from the previous year.

This robust enforcement stance has bolstered SARS’ ability to deter non-compliance while contributing directly to revenue.

SARS’ modernisation efforts have also contributed to its success.

The agency reported a 99.6% availability in its digital systems, ensuring that taxpayers could interact with SARS seamlessly across various platforms.

Kieswetter’s high salary, while controversial, can be seen as reflective of the vital role SARS plays in South Africa’s fiscal stability.

By exceeding revenue targets, enhancing compliance measures, and investing in modernisation, SARS has proven itself a key player in driving the country’s economic resilience.

However, the gap between public sector salaries and the President’s compensation continues to prompt debate over how resources are allocated within government structures.

In the broader context of South Africa’s socioeconomic challenges, Kieswetter’s payday serves as a stark reminder of the complex dynamics shaping public sector remuneration and the balance between rewarding performance and addressing inequality.

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