1 April 2025 – The South African Revenue Service (SARS) is pleased to announce a positive preliminary revenue-collection outcome for the 2024/25 fiscal year. This achievement takes place in a tough economic environment.
SARS is a cornerstone of our cherished democracy. Since its establishment, it has collected more than R23.3 trillion to help build a capable state that caters for all. This success is inextricably linked to an efficient and effective revenue administration that discharges its legal mandate to collect all revenue due to the fiscus, foster compliance and facilitate legitimate trade. As an organisation, everything we do, is about the transformational impact we have on the lives of people, which we call our “Higher Purpose”. We are on the road to reimage our organisation into a smart, modern SARS that can be trusted and admired by all, as encapsulated in our Vision 2025–2030.
By the end of March 2025, SARS had collected a record gross amount of R2.303 trillion, representing year-on-year growth of 6.9% against estimated nominal GDP growth of 5.4% (2024/2025). In this difficult economic environment, SARS paid refunds of R447.7 billion to taxpayers, the highest-ever amount in refunds (versus R413.9 billion in the prior year), representing growth of 8.2%. This brings the collected net amount to R1.855 trillion, which is almost R8.8 billion higher than the revised estimate, and R114.0 billion more than last year’s R1.741 trillion.
“I am pleased that the R447.7 billion returned into the hands of taxpayers is good for the economy”, said Commissioner Kieswetter. “I, however, remain deeply concerned about the ever-present threat of refund fraud and abuse of the system”. To illustrate this problem, in the period under review, SARS prevented the outflow of R146.7billion of impermissible refunds.
The preliminary revenue collection represents a substantial tax-to-GDP ratio of 24.8%, reflecting the country’s fiscal health and efficiency in revenue generation. Moreover, the tax-buoyancy ratio for the fiscal year 2024/25 was estimated at 1.20, indicating the robust response of tax revenue relative to economic growth. This buoyancy ratio underscores the government’s capacity to adapt its revenue-collection strategies to the dynamic economic environment, ensuring sustained fiscal stability and growth.
In the fiscal year 2024/25, the performance of key taxes has been a critical indicator of economic stability as South Africa navigates the complexity of post-pandemic recovery. There has been a notable shift in revenue streams, influenced by a combination of market dynamics, trade patterns, and consumer behaviour. This has resulted in shifts in the outlook for some of the key indicators that underpinned revenue performance. For example, nominal GDP was expected to grow at 5.7% at Budget 2024 and adjusted to 6.1% midway through 2024/25. At Budget 2025, the outlook had been reduced to 5.4%. The growth of some indicators, such as the wage bill, final household expenditure, imports, and exports were forecasted to fall during the year, whereas the estimates for gross operating surplus improved.
South Africa demonstrated uneven economic recovery, exhibiting both positive advancements and enduring difficulties. The Finance, Community, Wholesale, and Construction sectors had robust gains, contributing to the 6.1% year-on-year growth in revenue collections (2024/25) and 4.4% in GDP (2025). Below is the performance of the respective taxes.
Net Personal Income Tax (PIT) Including Interest
Net PIT (including interest) was estimated to grow at 13.8% at Budget 2024; 12.3% at MTBPS; and 12.9% at Budget 2025. Net PIT grew by R81.8 billion (12.6%), which could be partly attributed to above-inflation growth in the Finance and Community sectors’ pay-as-you-earn (PAYE), as well as the gains from Two-Pot withdrawals. The Two-Pot directives were valued at R12.9 billion for the year-to-date, compared to the projected estimate of R5.0 billion (R7.9 billion more). Furthermore, there has been a noticeable improvement in PAYE tax compliance, as indicated by the Voluntary Compliance Index, which rose by 0.38 percentage points from the previous year’s 75.10% (2024/25) to 75.48%. This uptick in compliance efforts is shaping taxpayer behaviour.
Net Company Income Tax (CIT) Including Interest
The assumption for Net CIT (including interest) was -3.3% at Budget 2024; 0.4% at MTBPS; and 1.1% at Budget 2025. Net CIT grew by R6.5 billion (2.1%), driven by CIT Provisional Tax collections of R323.3 billion, which were R10.5 billion (3.3%) higher than in the prior year, and exceeded the Budget 2025 estimate by (R4.3 billion, 1.4%). The growth was mainly due to the Finance sector, which was buoyed by improved profits, whereas the Mining sector continued to contract. The CIT Voluntary Compliance Index rose by 3.2 percentage points from the previous year’s 48.43% (2024/25) to 51.66% (February 2025), with notable improvements in filing compliance.
Net Value-Added Tax (VAT)
Net VAT, which contributed 24.7% of total collections, grew by R10.5 billion (2.3%).
The assumption for VAT refunds was growth of 7.6% at Budget 2024; 6.7% at MTBPS; and 7.2% at Budget 2025. At the end of March 2025, VAT Refunds amounting to R365.5 billion were disbursed, with year-on-year growth of R22.5 billion (6.6%). The top three refunded sectors were Mining (mainly owing to higher exports and local expenses), Finance, and Manufacturing. Preliminary indications are that SARS’s efforts avoided leakage worth R74.0 billion (R60.7 billion avoided in 2023/24), predominantly thanks to syndicated-crimes investigation, investigative audit, and tax verifications.
Total VAT refunds this year of R365.5 billion represent about 4.9% of GDP. It is pleasing that of all the refunds, R127.4 billion were directed to SMMEs, which are pivotal in driving job creation.
The assumption for Domestic VAT was growth of 6.4% at Budget 2024; 7.1% at MTBPS; and 7.3% at Budget 2025. Domestic VAT collections amounted to R562.1 billion, growing by R36.6 billion (7.0%). Of this, R271.0 billion (48.2%) of the Domestic VAT was paid by large business vendors, and R292.1 billion (51.8%) by “non-large” business vendors, predominately from the Finance sector. This growth can be attributed to factors including improved consumer sentiment, lower interest rates, contained inflation, and early pension-fund withdrawals, all of which have bolstered household consumption in the last quarter of 2024. Furthermore, an additional R9.8 billion was collected as cash from SARS Compliance Revenue efforts. The VAT Voluntary Compliance Index rose by 1.8 percentage points from the previous year’s 63.78% (2024/25) to 65.58%, signalling positive shifts in the in-year compliance trends.
The assumption for nominal imports was growth of 6.0% at Budget 2024; 3.8% at MTBPS 2024; and 1.5% at Budget 2025. The assumption for Import VAT was growth of 8.2% at Budget 2024; 0.7% at MTBPS; and -0.5% at Budget 2025. Actual imports had contracted by -3.3% by 31 March 2025, resulting in lower-than-assumed Import VAT of R2.30 billion as measured against the Budget 2025 estimate. Import VAT collections contracted because of fewer imports of electrical machinery as well as vehicles, parts, and machinery.
SARS believes that taxpayers are honest and want to be helped to meet their obligation. In this respect, SARS makes it easy and simple for taxpayers to transact with the organisation by proving clarity and certainty. However, when taxpayers wilfully abdicate their legal obligation, SARS makes it hard and costly for them.
SARS is taking advantage of technology such as data science, artificial intelligence, and machine-learning algorithms to counter criminality and wilful non-compliance. These systems also ensure that no legitimate refunds are denied, while preventing impermissible and fraudulent refunds.
The SARS Compliance Programme interventions generated R301.5 billion in compliance revenue, marking a 15.8% year-on-year increase. A portion of this revenue could be attributed to cash-collection initiatives, amounting to R154.8 billion. Strategies to prevent revenue leakage contributed another R146.7 billion. Efforts and outcomes from SARS’s administrative activities included:
- R94 billion from resolving over 3.7 million outstanding debt cases – supported by debt propensity ML models
- R103 billion from tax verifications where the risks were flagged through our AI driven risk profiling models powered with Big Data, debt equalisation and refund fraud risk management ML models – executing 1.7 million verifications cases
- R59 billion from executing 230 000 tax and customs compliance audits
- R30 billion from syndicated crime – conducting 198 complex investigations (made up of 165 Illicit, 33 State Capture)
- R15 billion from general compliance work – 870 000 compliance follow up
- 20 million service-related interactions at our branches, via the phone or through our digital self-service platforms assisting taxpayers and traders to comply.
The broad rise in revenue can be attributed to enhanced strategies and the diligent implementation of compliance measures. Revenue growth demonstrates the efficacy of targeted efforts to optimise fiscal outcomes. Such results underscore the importance of refining compliance operations to deliver sustainable financial growth and accountability. This remarkable achievement underscores SARS’s commitment to rigorous compliance and our ability to drive revenue-collection growth through strategic interventions.
As mentioned in the Budget 2025, the ongoing research to refine the estimation of SARS’s tax gap is showing promising progress, reflecting a dedicated effort to enhance fiscal transparency and efficiency. In 2023, the completion of the VAT Tax Gap Study was a milestone that set the stage for the current focus on CIT and PIT tax-gap studies, which have been under way since 2024.
The Minister of Finance, Enoch Godongwana, has allocated SARS an additional R7.5 billion over the MTEF period. SARS intends in the short to medium term to use this allocation to reduce its debt cash collection and pursue the more than 5 million outstanding returns. Equally important, SARS will continue to strengthen its efforts to deal firmly with the illicit economy, trade-based money laundering and illicit financial flows including illicit cigarettes, second-hand gold, crypto currency, trade mispricing and undervaluation fraud amongst others. Over the same period, SARS will also expand the modernisation of its systems in both tax and customs.
As we reimagine the organisation, we envisage a future state when tax transaction is seamless and just happens. This is an experience witnessed by nearly 5 million taxpayers who benefited from Auto Assessment last year, in which taxpayers did not have to do anything: by harnessing third-party data, SARS reconciled their tax affairs. Even though taxpayers retained the right to provide SARS with additional information the organisation did not have, the uptake of Auto Assessment was more than 98%, with those who made actual changes representing less than 1% of Auto-Assessed taxpayers. Those who were due refunds received them in 72 hours. Taxpayers who opted to file their returns received an outcome in five seconds. We are also pleased that taxpayer service has increased by 5.8% from last year to 87.13%. This is indeed a story of HOPE.
SARS is making steady progress in its strategic intent to build a tax and customs system that is based on voluntary compliance, while enhancing its capability to detect, deter, and make wilful non-compliance hard and costly. To exercise sovereignty over the destiny of our country, we must broaden our tax base and continue to encourage fiscal citizenship, while connecting people, data, and technology to deliver our mandate. As we step into the 2025/26 fiscal year, our primary goal is strategically to harness the components of our balance sheet. SARS will continue to deepen its work with and through all stakeholders in the tax ecosystem to engender trust in the organisation.
The success of SARS is integral to the success of whole of government. Several legacy projects if implemented will anchor and sustain the whole of government approach and strengthen the National Financial System. While the mandate of each government entities will be respected, we collaborate on several projects amongst other, a unique digital identity for individuals and entities, common portal ensuring data integrity segregation based on mandates of agencies. We will also look at a common payment platform with e-invoicing and this will reduce the volume of cash in the system as well as a common disbursement platform to replace the disparate payment platforms. SARS, subject to funding and appropriate support is ready to lead these initiatives since they are critical to our and other government departments success.
We are equally pleased that SARS employees through an employee engagement survey demonstrates a steady and remarkable improvement year on year. In the year 2024/2025, it stands at 71% from 69% in 2023/2024, moving from 61% in 2019/2020. This positive development communicates a clear message that every year our employees are committed to serve our country with steadfast determination and pride.
The Minister has set for SARS revenue estimate of R2.006 trillion for the 2025/26. This conveys confidence by the Minister on SARS’s ability to meet this challenge. We will spare no efforts in rising to this challenge.
“In the build-up to the momentous occasion of this revenue announcement, I made a clarion call to action to the whole SARS family regardless of whether they were in core operations, enabling, or support functions”, said Commissioner Kieswetter. “I must proudly state that they all responded resoundingly. They all went out and made calls and looked for the inches that contributed to this glorious result. I am deeply indebted to all my colleagues for rising to the challenge”. Their commitment to serve South Africans is self-evident.
“I also express my heartfelt thanks to all South Africans, especially compliant taxpayers and traders, for unfailingly meeting your legal obligations. We are forever working hard to make your experience with SARS easy and seamless — where the best service is no service at all”, he concluded.
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