{"id":842947,"date":"2025-11-12T15:02:20","date_gmt":"2025-11-12T13:02:20","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=842947"},"modified":"2025-11-12T15:06:05","modified_gmt":"2025-11-12T13:06:05","slug":"taxpayers-could-get-a-r20-billion-gift-from-government-if-sars-does-its-job","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/budget-speech\/842947\/taxpayers-could-get-a-r20-billion-gift-from-government-if-sars-does-its-job\/","title":{"rendered":"Taxpayers could get a R20 billion ‘gift’ from government if SARS does its job"},"content":{"rendered":"\n

Finance Minister Enoch Godongwana says that R20 billion in additional tax measures for 2026 could be withdrawn if SARS fulfils its end of the bargain and collects more debt as promised.<\/p>\n\n\n\n

Presenting the Medium-Term Budget Policy Statement on Wednesday (12 November), Godongwana noted that revenue collections in the first half of the year exceeded the May Budget’s estimate by R19.7 billion.<\/p>\n\n\n\n

“This higher revenue allows us to bring forward some once-off expenditure,” he said. <\/p>\n\n\n\n

The better-than-expected collections were mostly driven by higher VAT and lower VAT refunds, with a boost from the fuel levy, companies, and dividends tax.<\/p>\n\n\n\n

If South Africa maintains this trajectory, and if SARS’s revenue collections can beat expectations for the remainder of the year, the R20 billion in additional tax measures pencilled into the 2025 Budget for 2026 could be withdrawn, he said.<\/p>\n\n\n\n

As indicated in the 2025 Budget, the National Treasury allocated an additional R4 billion to the South African Revenue Services (SARS), giving it a total of R7.5 billion to work with.<\/p>\n\n\n\n

The allocation was intended in part to strengthen debt collection, and thereby increase revenue collected, with SARS targeting an additional R20 billion and R50 billion per year.<\/p>\n\n\n\n

However, SARS’s data for the first six months of the year showed that debt collections remained below May estimates, undershooting by around R700 million<\/strong>.<\/p>\n\n\n\n

This was because of the “legal and technical complexity of settling cases”, the finance department said.<\/p>\n\n\n\n

It noted that SARS has since obtained additional skills to address these kinds of cases, which should improve collections for the rest of the year.<\/p>\n\n\n\n

Godognwana said that the National Treasury will continue to monitor SARS’ performance for the remainder of the year.<\/p>\n\n\n\n

“This assessment will inform whether the R20 billion in additional tax increases for the 2026 Budget, as earlier proposed, can be withdrawn<\/strong>,” the minister said.<\/p>\n\n\n\n

“A final decision will be announced in the 2026 Budget.”<\/p>\n\n\n\n

\"\"<\/a><\/figure>\n\n\n\n

Why collections are higher<\/h2>\n\n\n\n

Revenue collections over the first half of 2025\/26 were 9.3% higher than the same period last year.<\/p>\n\n\n\n

This came as a result of stronger net VAT, corporate and dividends tax collection, all of which contribute to an improved near-term revenue outlook.<\/p>\n\n\n\n

Even without the contentious two percentage point VAT hike, VAT collections outstripped budgeted expectations by R11 billion, largely thanks to healthier household finances and recovery in consumer spending.<\/p>\n\n\n\n

There were also lower VAT refunds as fraudulent claims were stopped, wth the overall picture outweighing the weaker outlook for import VAT.<\/p>\n\n\n\n

The Treasury also flagged strong collections from the trade, electricity, and finance sectors, which supported corporate tax collections. Additionally, dividend tax receipts benefited from large one-off payments from the mining and retail sectors.<\/p>\n\n\n\n

In lieu of a VAT hike for 2025, Treasury increased the fuel levy for the first time since 2022, which led to a boost in revenue.<\/p>\n\n\n\n

However, fuel levy collections overshot initial projections by R2 billion due to strong growth in payments from fuel importers.<\/p>\n\n\n\n

Collections are expected to improve further, especially following a contraction in demand in 2024\/25, alongside large diesel refund claims settlements.<\/p>\n\n\n\n

\u201cRevenue buoyancy is expected to be 1.54 in 2025\/26, reflecting the stronger-than-expected collection in the current year,\u201d the department said.<\/p>\n\n\n\n

In addition to SARS undershooting its collection targets, there were also undercollections in other areas, such as excise duties, which were R2.3 billion short, and customs duties, which were R400 million short.<\/p>\n","protected":false},"excerpt":{"rendered":"

Finance Minister Enoch Godongwana says that R20 billion in additional tax measures for 2026 could be withdrawn if SARS fulfils its end of the bargain and collects more debt as promised.<\/p>\n","protected":false},"author":10,"featured_media":812934,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13716],"tags":[20799,3246,2887],"class_list":["post-842947","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-budget-speech","tag-godongwana","tag-sars","tag-tax"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/842947","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=842947"}],"version-history":[{"count":3,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/842947\/revisions"}],"predecessor-version":[{"id":842968,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/842947\/revisions\/842968"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/812934"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=842947"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=842947"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=842947"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}