CAPE TOWN, 22 October 2012 – The 2012 Tax Statistics bulletin is released four months earlier than the previous four publications and precedes the tabling of the 2012 Medium Term Budget Policy Statement (MTBPS) by the Minister of Finance.
The objective of releasing the country’s Tax Statistics is to publicise available, comprehensive tax revenue data that can assist policy makers and provide insights on economic indicators to researchers,analysts, the media and the public in general. This objective remains valid and underpins the contents of this publication.
The SARS Modernisation Programme – first introduced to the Personal Income Tax (PIT) system in 2007 and extended across all tax and customs systems since then – has supported faster data processing of all available tax revenue and customs information and has enabled SARS and the National Treasury to release the 2012 Tax Statistics bulletin at this time.
The 2012 Tax Statistics bulletin provides an overview of tax revenue collections and tax return information for the 2007/08 to 2011/12 fiscal years and the 2008 to 2011 tax years respectively.
The contribution of the annual Tax Statistics bulletins to informed debates on fiscal policy choices was emphasised on 23 May 2012 when the Commissioner of the South African Revenue Service (SARS) presented the 2011 Tax Statistics to the Standing Committee on Finance (SCOF). The Chairperson of SCOF and various other Members of Parliament commended SARS and National Treasury on the publication and the extent to which it informed debates on policy and fiscal sustainability.
SARS and National Treasury understand that presenting statistical data of this kind into the public domain will generate diverse interpretation and analysis. SARS and National Treasury trust that public discourse on the subject will be informed by objective analysis and the considered interpretation of statistical data.The true value of these statistics is not in any individual data point but rather, should be observed through the trends and the shifts they reveal when used over a period of time and when viewed within a particular context.
Over the last 18 years SARS has made tremendous progress in raising the levels of tax compliance in our country and in broadening the tax base. The number of registered individual taxpayers increased from 1.7 million in 1994 to more than 6 million in 2009/10. This number has since more than doubled following policy changes in 2011 to register all individuals in the country who are formally employed (13.7 million individuals by 31 March 2012).
Revenue growth in the country has increased progressively over successive fiscal years from R113.8 billion in 1994/95 to R742.65 billion 2011/12. This represents total growth of almost 550% since 1994, at an average rate of 11.6% per year.
The first Tax Statistics bulletin was published in December 2008 in an attempt to present the dynamics of our national tax base and revenue collection in a transparent manner to all taxpayers.
Over the same 18 year period the number of companies registered for income tax increased from 422 000 in 1994 to more than 2 million in 2011/12. Registered VAT vendors increased from 397 000 in 1994 to a peak of 745 000 in 2007/08, before reducing to 652 000 as a result of an increase in the compulsory VAT registration threshold from R300 000 to R1 million. SARS introduced stricter requirements for vendorswhen they register for VAT in order to combat VAT fraudand also implemented a rigorous clean-up of the VAT register. The number of registered employers grew from 177 000 in 1994 to 385 000 in March 2012.
It must be emphasized that millions moreSouth Africans who are not in formal employment, or who are employed but not registered for income tax because they earn below the income tax threshold, contribute, in varying degrees to the fiscus through the tax system.
Almost all consumers pay indirect taxes such as VAT, excise duties and the fuel levy on the goods and services they purchase on a daily basis.Through these purchases consumers also contribute todirect taxes that SARS collects in the form of Corporate Income Tax (CIT) from the profits of the companies who provide such goods and services.
South Africa has done well in growing the tax base and in improving the levels of tax compliance in the country. However, the South African economy finds itself in transition where there is a constant migration of individuals from the informal into the formal economy. SARS’s compliance strategies have to take this reality into account.
The 2012 Tax Statistics publication has evolved significantly over the past few years and many innovations, developed from the extensive feedback received, have been incorporated into this publication. SARS and National Treasury want to thank all contributors and want to encourage further engagement.
The publication consists of the following chapters:
• Chapter 1: Revenue collections-provides a summary of aggregate tax revenue collection trends for the period 2007/08 to 2011/12.
• Chapter 2: Personal Income Tax (PIT)-gives an overview of assessed personal income tax revenues of registered individual taxpayers. It also provides information on taxable income by income group, age, gender and source of income, as well as on fringe benefits, allowances and deductions.
• Chapter 3: Company Income Tax (CIT)-gives an overview of corporate income tax revenues. Information on taxable income by income group, sector and type of business entity is provided.
• Chapter 4: Value Added Tax (VAT)-gives an overview of VAT. It gives a breakdown of VAT receipts and refunds by sector and payment category as well as an overview of data on input and output VAT as derived from VAT returns submitted by vendors.
• Chapter 5: Import VAT and Customs Duties-provides information on the customs value of imported goods by product type in terms of the Customs Harmonised System , to chapter level, as well as Import VAT, customs/import duty and ad valorem excise duty revenues on imported goods.
In response to widespread consultation with stakeholders and feedback from individual users, additions and enhancements have been made to the 2012 Tax Statistics. The data series and available information have been extended and reformatted as follows:
• An analysis of payment channels of SARS collections is provided in Chapter 1.
• Revenue collection tables on Mineral and Petroleum Resource Royalties (MPRR) per commodity per fiscal year have been included for the first time.
• The methodology to determine the number of liable taxpayers has been amended, which has significantly changed the CIT assessed percentage in Chapter 3 and slightly altered the PIT assessed percentage in Chapter 2.
• A table by income grouping, which is effectively a table by taxable income to which deductions are added back, has been included in Chapter 2.
• A table that shows the effective CIT rate for various taxable income groups has been included in Chapter 3.Distribution charts for PIT and CIT by taxable income group for the number of taxpayers and tax assessed.
The 2012 Tax Statistics highlights booklet is attached as Annexure A.
An electronic version of the full publication (as well as the Excel tables used in this publication) is available for download on both the websites of the SARS (SARS) (www.sars.gov.za/taxstatistics) and that of National Treasury (www.treasury.gov.za/publications/ tax%20statistics).
Both institutions welcome public comments and suggestions to enhance the publication’s utility in policy evaluation and developing new insights in South Africa’s social and economic context. These can be provided via e-mail to [email protected].
Final Media Conference Powerpoint Presentation
Issued by the South African Revenue Service and National Treasury
For further media enquiries, please contact the following officials —
On behalf of National Treasury, Phumza Macanda, 082 513 7458
On behalf of SARS, Adrian Lackay, 083 388 2580