Establishment, Accountability and Assurance

The South African Revenue (SARS) is established in terms of the South African Revenue Service Act, 34 of 1997 (SARS Act) as an organ of state within the public administration, but as an institution outside the public service.

The mandate of SARS is to collect all revenue due, ensure optimal compliance with tax and customs legislation, provide a customs service to optimise revenue, border protection and facilitate legitimate trade. To give effect to the SARS mandate, the Strategic Intent of SARS is to develop a Tax and Customs system based on voluntary compliance. In support of the Strategic Intent, and to give effect to the SARS compliance philosophy, SARS have identified and committed to achieving nine Strategic Objectives to guide and inform our efforts and decisions and focus our resources over the course of this planning cycle.

As the South African Government tax authority, SARS has a responsibility to administer the nation’s tax laws. The work of SARS enables Government to build a capable State, to foster sustainable economic growth and social development that serves the wellbeing of all South Africans.

The Commissioner is appointed by the President and is the Chief Executive Officer and the Accounting Authority for SARS. The Commissioner accounts to the Minister of Finance (as the Head of National Treasury) for the management of SARS and does so in accordance with legislation and National Treasury policies. In terms of the Public Finance Management Act, 1 of 1999 (PFMA), the Commissioner is also accountable for the accounts and financial management of SARS to Parliament (Standing Committee on Finance and Standing Committee on Public Account) via the Minister of Finance.

In terms of Regulation 27.1.1 of the Treasury Regulations, 2005 issued in terms of the PFMA, the Commissioner established the SARS Audit and Risk Committee. It plays an oversight role to ensure that appropriate systems of risk management and internal control are in place, oversees the internal audit function, ensures that an assurance model is applied in SARS and oversees integrated reporting.

In terms of section 11 of the SARS Act advisory committees may be appointed with the main objective of advising the Commissioner and the Minister on any matters concerning the management of SARS. In terms of section 28 of the SARS Act, the Auditor General South Africa audits the accounts and financial records of SARS, including those relating to the collection of revenue.

The SARS governance philosophy is based on the Combined Assurance Model and follows the five lines of assurance methodology. A combined assurance model incorporates and optimises all assurance services and functions so that taken as a whole they enable an effective control environment. Combined assurance ensures that SARS as an organisation has a coordinated holistic approach to assessing and managing risks facing the organisation. There are a number of assurance role players for governance in SARS. The key differentiating factor between the role players within the five lines of assurance, is the levels of independence of each role player, from the organisation’s operational activities.  

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