By Lehlohonolo Lehana.
The South African Revenue Service (SARS) commissioner Johnstone Makhubu has called on the National Prosecuting Authority (NPA) to fast-track prosecution on tax-related cases.
Makhubu was speaking at the RMB Think Budget breakfast, held a day after the Medium-Term Budget Policy Statement (MTBPS).
He said he has met the head of the NPA, Advocate Andy Mothibi, over coffee twice to urge faster investigations, and that the two entities are working together.
He points out that investigators who pursue tax evasion and criminal activity, sometimes at considerable risk to their lives, become frustrated when cases do not result in prosecutions, and suggests the NPA could have a backlog of about 1 000 tax-related cases.
“If you’ve got 1 000-plus cases that are sitting in a backlog with [the] prosecution, it does not mean that the tax administration has not done its work. It has done its work …”
Sars is also stepping up efforts to tackle the illicit economy, including the sale of cigarettes and alcohol without the payment of excise duties.
Makhubu said whether the annual tax loss amounts to R100 billion or R200 billion, the figure is unacceptably high.
By the end of the calendar year, Sars plans to issue a tender for a technological solution to help it track products subject to excise duties and identify illicit trade.
This includes alcohol, cigarettes and pharmaceuticals, as well as products subject to the Health Promotion Levy on Sugary Beverages.
Sars is also in discussions with the South African Bank Note Company, a subsidiary of the South African Reserve Bank (SARB), to develop a marker that is comparable to or better than the technology used to authenticate banknotes, for use on products on which excise is paid.
Makhubu added that artificial intelligence had helped SARS stop incorrect VAT refunds worth R61 billion.
Finance Minister Enoch Godongwana revealed this week that tax collections in the country have overshot targets set in the February Budget, prompting the department to raise the bar.
The new revised estimate for tax collections, as contained in the Medium-Term Budget Policy Statement on Wednesday (21 October), is a record R2.144 trillion.
This is an increase of R17.1 billion compared to the R2.127 trillion February 2026 Budget estimate.
Commenting on the new target, Makhubu said SARS was ready to chase it.
The national tax service noted that the upward adjustment to the target comes despite deteriorating economic conditions, with the Treasury cutting the GDP growth forecast from 1.6% to 1.2% in 2026.
Makhubu noted that, as of 30 September 2026 (H1 2026), the taxman collected R992.2 billion in net revenue.
This includes gross collections of R1.231 trillion and refund payments totalling R239.1 billion.
Net revenue was R15.5 billion, or 1.6%, above the February 2026 Budget estimate, and R67.4 billion, or 7.3%, higher than the corresponding period last year, highlighting the outperformance.