President Cyril Ramaphosa has announced the terms of reference for the Sars inquiry. Picture: Hannah McKay/Reuters
President Cyril Ramaphosa wants the commission of inquiry into tax administration and governance at Sars to investigate reports of mismanagement that have plagued the agency and dented its reputation.

Ramaphosa has released the terms of reference for the inquiry which will be headed by retired Judge Robert Nugent.

Nugent will be assisted by Prof Michael Katz, Advocate Mabongi Masilo and Vuyo Kahla.

The president wants the commission to deliver an interim report by September and to have a final report ready by the end of November. He said this is to ensure that Sars is able to meet the revenue targets announced by former Finance Minister Malusi Gigaba as part of his budget speech.


The terms of reference for the inquiry include:

* The adequacy and legality of steps that Sars took to address revenue shortfalls in the last two years, including allegations of unauthorised payment of bonuses to top executives and withholding of refunds owed to ordinary taxpayers.

* The performance of tax administrative duties and application of discretionary powers required or enabled by existing tax legislation.

* The adherence to tax administrative processes, and whether deviations from the established processes unfairly benefited politically-connected persons and persons connected to top managers of Sars.

*The adherence to customs and excise provisions, with particular reference to tobacco products.

* The adherence to internal personnel policies and HR practice, in light of the exit of senior personnel and alleged coercion of Sars officials to resign.

* The impact of the conduct of Sars management on the public image of Sars, upholding the basic values and principles governing public administration envisaged in section 195 of the Constitution.

* The impact of any change in the operating model of Sars on the effectiveness of Sars operations.

* The integrity of supply-chain management and tendering processes.

This inquiry is part of the president’s campaign to tackle the issues affecting state institutions.

Ramaphosa said he hopes the inquiry will help restore credibility in Sars.

Suspended Sars commissioner Tom Moyane. FILE PHOTO: ANA
“Both the Minister of Finance and I are keenly aware of the need to demonstrate to the people of South Africa that the tax revenue collected from their hard-earned income is being used wisely, productively and for its intended purpose. We remain accountable to the people of this country,” he said.

The disciplinary inquiry for suspended Sars Commissioner Tom Moyane is a separate process from the Sars inquiry.

Moyane was placed on suspension in March and will face 12 charges at an inquiry to be headed by Advocate Azhar Bham.

All the issues to be interrogated by the Sars inquiry occurred during Moyane’s tenure as the head of the revenue service.

Political Bureau