NEWS

Gordhan Moves To Improve Tax Collection Regulations

Gordhan's move gives him the power to set regulations to improve tax collections, but chances are the Sars commissioner will not be happy.

02/03/2017 10:54 SAST | Updated 02/03/2017 11:01 SAST
Ruben Sprich / Reuters
Pravin Gordhan, Minister of Finance of South Africa attends the annual meeting of the World Economic Forum (WEF) in Davos, Switzerland, January 17, 2017. REUTERS/Ruben Sprich

Finance minister Pravin Gordhan has intervened to compel the South African Revenue Service (Sars) to improve tax collection and to compel it to provide National Treasury with information needed for planning, Business Day reported.

Treasury deputy director-general Ismail Momoniat told Parliament's two finance commitees that an amendment to the Income Tax Act and the Value Added tax Act has been tabled in Parliament by Gordhan.

The amendments will reportedly give Gordhan the power to prescribe regulations to officials who are responsible for administering the Income Tax Act.

In a briefing ahead of the budget last week, Gordhan reportedly told the media that he was worried about Sars' tax collection methods. There was a R30.4 billion tax revenue shortfall in 2016/17 and Gordhan raised concerns that Sars was not fulfilling its duties.

But Business Day reported that Sars commissioner, Tom Moyane, has taken strong exception to Gordhan's statements.

Momoniat reportedly told Parliament that there were legal provisions that allowed for the minister of finance to make regulations relating to information needed from the commissioner to increase transparency around tax collection.

The Mail & Guardian reported last week that the relationship between Moyane and Gordhan has severely soured, with Moyane asking Zuma to appoint a judge to mediate between the two.