THE taxman collected more than R1bn via the Special Voluntary Disclosure Programme (SVDP) which closed at the end of August, perhaps bringing some relief to Finance Minister Malusi Gigaba who is preparing to present his first mini-budget in two weeks’ time.
Revenue service SARS is aiming at an ambitious tax target of R1.2 trillion for the financial year 2017-18, with some experts saying that this could be revised downward in the mini-budget in light of the tough economic environment in which growth is near zero and jobs have seen a net loss.
When profits are down, companies don’t expand and there are fewer salaryearners in the tax net. The inevitable result is a reduction in tax revenue. The success of the disclosure programme and last week’s announcement that more than 2.7 million taxpayers had submitted their tax returns since July this year are encouraging.
Furthermore, a total of R62.1bn has been paid over to taxpayers in refunds. The tax season runs to November 26. SARS said the R1bn of revenue collected to date on SVDP is only from the number of applications processed thus far and not from the total applications tallied. “To date, about 2000 SVDP applications have been counted, of which 335 have been processed, signalling that the revenue could skyrocket as the remaining applications are processed,” SARS said.
The SVDP offered non-compliant taxpayers a once-off opportunity during a limited time to regularise their unauthorised foreign assets and income by voluntary disclosing tax and exchange control defaults specifically in relation to offshore assets. “This revenue provides a boost to SARS’s revenue purse in a difficult economic period and will assist the country in its socio-economic development. “SARS is quite satisfied with the response by South African taxpayers and traders to take advantage of the SVDP,”
SARS boss Tom Moyane said. He said applications are being processed by SARS teams consisting of legal, tax and finance experts, and that the outcome will be known “in due course”. The finance minister has already indicated that lower revenue collection will affect the budget, and will mean the government will have to cut expenditure, find ways to raise additional revenue, and at the same time promote economic growth.
Tertius Troost, tax consultant at Mazars, said the voluntary disclosure programme appeared to be a success. “The programme is still running and many more applications are still to be processed – this can change everything,” he said.