Finance Minister Tito Mboweni delivers his Medium-term Budget Policy Statement in Parliament. Picture: Phando Jikelo/African News Agency/ANA

CAPE TOWN – Finance Minister Tito Mboweni said on Wednesday that the government would implement the findings of the Nugent Commission of Inquiry into Tax Administration and Governance at the South African Revenue Service (Sars).

The Minister said this in his second Medium-term Budget Policy Statement in Parliament where he stated that this had already been approved by cabinet and he intends to table a bill early next year. 

President Cyril Ramaphosa appointed Edward Kieswetter as the new Sars Commissioner in May. Mboweni highlighted that since Kieswetter started work, he has already taken steps to re‐invigorate and re‐establish the Large Business Centre, and the litigation, integrity and compliance units. 

He said leadership, staffing and procurement failures are also being addressed.

“Achieving a more inclusive South Africa relies on honest taxpayers. Without your taxes, South Africa will never succeed. 

“Thank you to all those who have honoured their obligations. But you have told us that we must spend your hard‐earned money better, and we could not agree more.   We now expect to collect R1.37 trillion this year. 

“This is R53 billion, or 4 per cent, less than we expected. Looking ahead, our revenue forecasts are prudent. We assume an elasticity of one, which means a one-to-one relationship between growth in taxes and economic growth, after adjusting for tax measures,” said the Minister in his statement.

The Federation of Unions of South Africa (Fedusa) in a statement released before the MTBPS expressed outrage that Minister would deliver the mini budget on the back of a  tax revenue shortfall of an estimated R50 billion for the current financial year. 

Fedusa said it was deeply disheartened about the effect the massive revenue shortfall will have on Mboweni’s ability to address key economic constraints.