Sars commissioner Edward Kieswetter is well pleased with tax collections this financial year. File Picture: GCIS
The South African Revenue Service (Sars) said that as of the end of March 2024, the institution has collected a record gross amount of R2,155 trillion, year-on-year 4,2% against the nominal GDP of 4,9%.
The tax body said on Tuesday that has also paid out refunds of R414 billion to taxpayers, the highest ever quantum in refunds compared to R381 billion in the prior year, representing growth of 8.6%.
The figures illustrate that the tax man has collected a net amount to R1.741 trillion which is almost R10 billion higher than the revised estimate and R54 billion more than last year’s R 1.687 trillion.
Sars noted that in terms of just Valued Added Tax (VAT) refunds, the organisation drew in R343 billion and this represented a growth of 7.5% over last year.
The tax agency said that total refunds this year, represented around 6% of GDP.
“It is therefore pleasing that R120 billion and R37 billion of the refund benefit, respectively, were directed to SMME’s and individuals. This is good when business and individuals remain cash-strapped,” Sars said.
Sars Commissioner Edward Kieswetter said that he was pleased that R414 billion was returned into the hands of taxpayers, but was concerned about the refund fraud and abuse that is still prevalent.
“The R21.6 trillion tax collections represents a compound growth of 9.9% per year since the inception of Sars in 1997. This has funded the South African democracy and touched the lives of millions who would be destitute without government support and services,” Kieswetter said.
“We, who have the privilege to work at Sars are justly proud of these achievements because these efforts contribute directly to nation-building and sustain our democracy.”
When compared to the 2022/23 fiscal year, total tax revenue increased by R54.2 billion (3.2%), driven by personal income taxes of R49.5 billion (8.2% year-on-year) on the back of higher than estimated compensation of employees, as well as higher domestic VAT of R39.3 billion.
Sars added that net personal income tax, which accounts for 37.3% of total revenue, grew by R49.5 billion 8.2% in 2023/24, as employment improved year-on-year from and average wage settlement rates improved from an annual average of 6.0% in 2022 to 6.3% in 2023.
The South African Institute of Taxation (SAIT) said on Tuesday that it welcomed the delivery of the 2023/2024 preliminary revenue results by Kieswetter.
“Sars recorded the highest revenue collection since the dawn of democracy, with over R114 billion collected in the past four days, the same amount which was then collected throughout 1994,” SAIT said.
“When we are looking further at the targets, the strategy has been working. The strategy has been not to raise taxes on the innocent, but to expand the tax base on the guilty,” SAIT CEO, Prof Keith Enge said.
“What you have seen is a growth in the number of taxpayers with a focus on high-net-worth individuals, voluntary compliance has grown from 61.6% to 63.9% and there is also an attempt to eliminate failure to disclose through third-party,” Enge added.
“For those who think they can escape the taxman, it is becoming harder and harder,” Enge noted.
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