The South African Revenue Service was a fraction of a percentage off its estimates in tax collection for the 2017\/18 financial year, collection R1.216 trillion – 0.06% lower than the estimate of R1.217 trillion.<\/p>\n
Despite the slightly lower collection, revenues were up 6.3% from the 2016\/17 financial year, with the taxman collection R72.4 billion more.<\/p>\n
In announcing the numbers, finance minister Nhlanhla Nene stressed that these were preliminary results and not the final numbers, which are still subject to a final audit.<\/p>\n
According to Nene, SARS collected a gross amount of R1.451 trillion, which was offset by refunds totalling R234.3 billion.<\/p>\n
The minister said that revenue collection is closely tied to the state of the economy, and that the 2017\/18 financial year was characterised by low growth patterns which impacted most sectors.<\/p>\n
However, there was a reverse in this trend with an uptick in business and consumer confidence in the last quarter of the year (January to March 2018).<\/p>\n
This was helped by the strengthening of commodity prices and a stronger rand, Nene said.<\/p>\n
Despite this, the recovery is yet to translate into higher employment numbers and strong growth in wages – as a result pay-as-you-earn (the largest contributor to the SARS tax portfolio) came in at 8.6%, significantly below the 9.2% levels experienced in previous years, Nene said.<\/p>\n
This is how the tax revenue was broken down:<\/p>\n
Tax dodgers<\/strong><\/p>\n Nene said that for any tax authority, tax compliance was one of the key determinants of its revenue performance.<\/p>\n Here, SARS has seen a deterioration in compliance, indicated by the overall growth in outstanding returns across all tax types.<\/p>\n “More concerning though, it the increasing tendency of business to withhold taxes such as VAT and PAYE collected on behalf of SARS,” he said.<\/p>\n SARS has stepped up its ‘outreach and enforcement’ programmes, Nene said, and has made over one million outbound calls to taxpayers. This process will be boosted in 2018\/19 until the matter is under control, he said.<\/p>\n
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