SARS Commissioner Advocates Exempting Tax Administrators from Budget Cuts

South African Revenue Service (SARS) Commissioner Edward Kieswetter has urged National Treasuries to exempt tax administrators from widespread austerity measures, emphasising that such actions could hinder innovation, fiscal integrity, and national sovereignty.

Speaking at the 2nd Network of Tax Organisation (NTO) Technical Conference in Cape Town, Kieswetter stressed the importance of safeguarding funding for tax administrations, especially in the digital age, where innovation is central to improving tax compliance and detecting non-compliance, per SANews.

He highlighted the growing reliance on digital transactions, increased sharing of third-party data with tax authorities, and the emergence of central bank digital currencies. All underscore the importance of digitalisation, data science, and artificial intelligence in revenue collection, compliance, and trade facilitation.

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Kieswetter argued against across-the-board budget cuts and called for a more prudent approach that prioritises investments in building economic capacity, job creation, and tax base expansion. He argued that protecting fiscal integrity and sovereignty in the long term requires exempting tax administrations from austerity measures and ensuring that investments in digitalisation remain uninterrupted.

The Commissioner acknowledged that the COVID-19 pandemic accelerated SARS’s modernisation and digitisation efforts. It prompted a reevaluation of technology investments to enable employees to work during lockdowns and taxpayers to fulfil their obligations.

While SARS has made progress in its digitalisation journey, Kieswetter stressed that more needs to happen to catch up. He pointed out that years of budget freezes had left the revenue service behind in technological innovation.

Kieswetter noted that SARS faces the dual challenge of catching up after years of underinvestment and accelerating modernisation to remain relevant in a rapidly changing environment. He emphasised that digitalisation is an ongoing journey. He warned that suspending funding could lead to a regression in innovation and hinder progress compared to other administrations.

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Picture: X / sarstax

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