Finance minister Enoch Godongwana has increased the size of Sars’ budget by R4-billion after three meetings he had with revenue commissioner Edward Kieswetter, bringing the total over the next three years to R7.5bn.
The additional R4bn is not included in the Budget Review tabled in parliament on Wednesday.
At a media briefing ahead of Godongwana’s budget speech in the National Assembly, Kieswetter said the budgetary allocation would be used for Sars to operationalise its systems.
He said Sars had a significant debt book due to the state in uncollected tax and outstanding returns that had not been submitted.
Kieswetter said in the 2024/25 financial year Sars had used the R1bn allocated in the previous financial year for a ring-fenced project to target the reduction in debt and to facilitate a more efficient turnaround time of declarations against which refunds were due.
“If we don’t do that we will simply pay out the refunds without doing verification,” he said. This had been useful in preventing the outflow of impermissible refunds by using artificial intelligence.
“What we have asked the minister is to retain that R1bn so that we can continue with this project and give us another R1bn so that we can double up our efforts on reducing the debt book. If we can replicate the experience we have had in the current year that will also improve the revenue outcomes.”
Kieswetter said R2bn would be used in 2025/26 to reduce the balance sheet — outstanding returns and debt owed to Sars — and R500m for modernisation.
In the outer two years, R1bn has been allocated for each year to focus on the balance sheet project, specifically on reducing debt.
Further engagements would be held on the remaining R500m which Kieswetter would like to use to accelerate the modernisation project and build Sars’s internal capacity to close the tax gap.
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