Johannesburg - As suspended Sars commissioner Tom Moyane pushes for the Sars inquiry to be halted, the numerous testimonies at the inquiry have provided a chilling picture of the questionable changes at the tax agency. The Sars inquiry was appointed by President Cyril Ramaphosa to investigate tax and governance issues at the organisation.
The president's decision to appoint the commission was largely driven by the growing scandals at the agency and billions in revenue shortfall. The commission began its work last week but will resume hearing more witnesses in August. The commission, which is chaired by Judge Robert Nugent, heard the testimonies of 13 witnesses who worked at Sars.
What became evident was the change of culture at the agency once Moyane was appointed in 2014, to replace acting commissioner Ivan Pillay. The interviewees painted a grim picture of how staff members operated under a climate of fear as various incidents and changes at the agency pointed to a change in culture.
Culture of fear
Sars has faced a massive exodus of senior staffers, with important institutional memory, over the past couple of years and the reason for this has been blamed on Moyane’s leadership style. Former Sars commissioner Pravin Gordhan was the first to take the stand and explained the systems that were in place before he left. Gordhan also questioned the restructuring by Moyane, which led to a tense relationship between the two.
Thebeletso Seremane, who worked on Sars’ code of conduct, said she and a number of employees were demoted during the restructuring at the agency. Seremane also told the inquiry that individuals that were not qualified for positions were promoted at random.
She highlighted the promotion of Kelly-Anne Elskie, who had been named as the girlfriend of former Sars executive Jonas Makwakwa. Sunita Manilk, who headed up Sars' business centre, said she was sidelined and marginalised by Makwakwa, who reached tax settlements with corporates without consultations.
The former head of group legal services, Makungu Mthebule, testified to the extent of Makwakwa’s interference in her work. Mthebule said Makwakwa would constantly ask her about the status of certain taxpayers. “Makwakwa would SMS me and say he was with this high-level taxpayers, where are we with this taxpayer. This was wrong,” she said.
Cigarette company inspections and the "rogue unit"
Former Sars employee Gene Ravele testified how the inspections done by Sars at cigarette factories were halted by Makwakwa. “After I left, there was no inspections at cigarette factories. Until today. When the minister of finance complains of the lack of compliance, it was planned,” said Ravele.
He also used the testimony to dispel rumours about the High-Risk Investigative Unit, which was known as the “rogue unit”. The unit was disbanded after Moyane was appointed in 2014. Ravele said the unit was crucial to Sars operations as it helped bust a number of criminal activities.
Former deputy Sars commissioner Ivan Pillay testified and defended the establishment of the unit. Pillay said the unit did its job well and was able to tackle a number of illicit dealings as it worked closely with the intelligence agencies.
“I think overwhelmingly they did the right thing. Is it possible that some things went wrong, I think that’s possible. Unlike a normal auditor, this unit would be prepared to sit outside a gate and see how many trucks left a factory. They did work on Krejcir. They did work on illicit gold dealing where we made huge breakthroughs,” said Pillay.
The establishment of such units was not unusual and many countries had them in place, said Pillay.
The commission will continue its work in August. Makwakwa had written to the commission requesting an opportunity to be heard. He is likely to testify when the inquiry resumes.