PRACTITIONER CONNECT - ISSUE 19: november 2020

Welcome to the latest edition of Tax Practitioner Connect, the electronic newsletter for tax practitioners that keeps you up to date with the tax matters that affect you.
 

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17 November 2020 -  The eBooking toll-free number is no longer operational. Please book an appointment via our online system, eBooking.
 

SARS Commissioner, Edward Kieswetter, recently met with the leadership of controlling bodies in the tax practitioner community.  The engagement was to create an understanding of the strategic direction of SARS, and to discuss the commitment of external stakeholders towards building a culture of voluntary compliance in the country.

Tax practitioners and their controlling bodies are important stakeholders, as they influence the behaviour of taxpayers. Currently, SARS has almost 24000 registered tax practitioners, representing almost 3.5 million taxpayers, thus making tax practitioners an essential partner for SARS in the journey towards achieving higher compliance levels.

Commissioner Kieswetter is committed to increasing compliance levels and has included the strategic objective “working with and through stakeholders” in his strategic plan for the organisation. This includes RCBs and tax practitioners and emphasizes SARS' willingness to engage with external bodies on the journey towards improved compliance.

Since taking over the reins at SARS, the Commissioner’s leadership has been characterised by transformation within the organisation. He has a clear vision of building a smart and modern tax authority, with unquestionable integrity, trusted by government, stakeholders, the public and our international peers.

To execute the SARS mandate optimally, a culture of voluntary compliance should prevail that will increase revenue collection, and build a sense of responsible fiscal citizenship. This theme resonated during the recent leadership level meetings with the sector.  

The Commissioner noted that the current narrative around State Capture was one of the reasons for lower compliance.  He informed the meeting that SARS was on a mission to identify such non-compliance and to address it, whether it existed internally or in the external environment. He also noted that SARS is currently pro-actively working to identify the tax compliance of individuals involved in public spaces like the Zondo Commission and the media.

The Nugent Commission found that SARS had been a victim of State Capture, resulting in a loss of public trust in the institution and its staff.  The Commissioner plans to change the current perception by committing SARS to the following nine strategic objectives:

  • Make it as easy and simple as possible to comply with tax obligations
  • Create awareness of tax obligations, as well as clarity and certainty about expectations
  • Make it difficult and costly not to comply
  • Modernise SARS’ systems to provide seamless online digital services
  • Use data for insights, risks and improved outcomes
  • Develop an engaged, agile and diverse workforce
  • Use resources efficiently to deliver quality outcomes and excellence
  • Work with, and through stakeholders to improve the tax system
  • Build credibility, public confidence and trust.

While each of the nine objectives is necessary to achieve voluntary compliance, many of them are inter-related. For example, the importance of credibility, public confidence and trust count among the top strategic objectives.

However, to achieve this, SARS believes in building a strategic partnership with stakeholders to improve the tax system and respond to their needs, which is an essential and interconnected strategic objective.

The new SARS structure is intentionally flatter to entrench more accountability amongst SARS leaders, the Commissioner responded to questions from RCBs attending the meeting, adding that the specific objective was to facilitate deeper focus on different sectors. Whilst the former structure was more centralised, the new segmented approach is meant to increase the authority and responsibilities of the newly appointed 12 regional directors, supported, amongst others, by two senior leaders to take responsibility for stakeholder strategic development and operational matters.

He said a list of Senior SARS Officials (SSOs) would be published on the website as soon as SARS is in a position to finalise the matter, which had been difficult to complete as the external recruitment drive has been held back due to the Covid-19 pandemic. 

Regarding SARS’ plans to deal with intentional non-compliance, Commissioner Kieswetter acknowledged that the previous SARS model concentrated more on following up on taxpayers who had submitted and declared income, while deliberate non-compliance was not adequately dealt with. SARS has also identified non-compliance relating to PAYE return submissions as a serious risk, and is currently looking at external sources to develop our capacity in this regard.

Referring to SARS’ strategic objective of working with and through stakeholders to improve the tax system, the Commissioner assured the tax practitioner community that SARS regards tax practitioners as an intrinsic part of the journey to tax morality.

Ms Dipuo Mvelase, as Head of the Government & Tax Practitioner segments, would concentrate on deepening our understanding of these two critical groups of stakeholders. It is expected that from such understanding, SARS will be able to contextualise our service offerings, which the sector will find useful. In addition, this segment will concentrate on incentivising a compliance culture that rewards consistent high compliance. Mr Mark Kingon, as head of Stakeholder Relationships, is responsible for end-to-end relationships with stakeholders, including the RCB’s, and will work together with the Government & Tax Practitioner segment to ensure synergy and consistent messaging when SARS engages the sector. Stakeholder Relations will deal with the critical more systemic escalations and ensure that the relationship with stakeholders is stabilised and improved.

SARS is also considering a mechanism to act as an early warning system for non-compliant tax practitioners, to allow the RCB to intervene before SARS takes action against a tax practitioner, as an initiative to provide a more effective and efficient service to this sector.

In conclusion, the Commissioner said that “SARS is looking forward to building a strategic partnership with the tax practitioner community, which will benefit both your clients and SARS.”

Last Updated: 17/11/2020 1:55 PM     print this page
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