South African Revenue Service

The South African Revenue Service (SARS) is the revenue service of the South African government. It administers the country's tax system and customs service, and enforces compliance with related legislation. It is governed by the SARS Act 34 of 1997, which established it as "an organ of state within the public administration, but as an institution outside the public service". It thus has a significant degree of administrative autonomy, although it is under the policy control of the Minister of Finance. SARS manages, administers, and implements the tax regime as designed by the Minister and National Treasury.

SARS was established in 1997 by a merger of the customs and inland revenue departments, at the recommendation of the Katz Commission, which had been instituted to review the South African tax system for the post-apartheid era. In subsequent years, under the leadership of Pravin Gordhan, SARS gained a reputation for effectiveness. However, between 2015 and 2019, the agency's tax collection and investigative capacities were severely undermined, or even "decimated", as a result of a restructuring", allegedly calculated to enable the capture of SARS. This was investigated by the Nugent Commission.

Functions

In terms of the SARS Act, the main functions of SARS are to:

collect all tax and customs revenue due to the state;

enforce compliance with tax and customs legislation; and

facilitate legitimate trade through the customs service.

Among others, SARS administers the personal income tax, corporate income tax, capital gains tax, value-added tax, customs and excise duties, skills development levies, environmental levies, unemployment insurance fund contributions, and employment tax incentives.