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4. SARS SITUATIONAL ANALYSIS AND COMPLIANCE LANDSCAPE
» and trade facilitation increased by 19 percentage points to 72%. • On building public confidence, the past 6 years have seen: » taxpayer service rising from 54% to 87%; » public trust up 48% to 75%; » and attitude to compliance up 11 percentage points to 77%. • As an attractive employer, SARS is recognised as the best employer by BCom/Accounting professionals, the most innovative public-sector organisation for digital transformation, in 2023, the most transformed public sector organisation in 2025, and increased employee engagement from 61% to 71%. • From a leadership perspective, we serve as Chairs of World Customs organisation, Africa Tax Administration Forum, OECD Global Forum Africa Initiative, Co-Chair of the Crypto Assets Reporting Framework, and as Vice Chair at the OECD Forum of Tax Administrations. » Digital and Operational Efficiency: Significantly implemented the SARS Digital Playbook to advance the aspiration of “Tax Just Happens”. • Introduced Auto-Assessment that has eliminated the need for 5.8 million individual taxpayers to file a return, achieving a 99% acceptance rate • Reduced assessment times to under 5 seconds consistently for taxpayers who are required to file • Refunds are paid in under 72 hours for almost 90% of taxpayers • Deployed machine learning models and AI not only delivered the world class service to taxpayers, whilst our fraud risk detection AI has prevented impermissible refund payments of R440 billion • Achieved 99.61% system uptime, 88.49% digital channel usage, and 98.10% risk detection rate
This situational analysis provides a refined overview of internal and external factors influencing SARS as it advances its modernisation agenda. It focuses on key strengths, weaknesses, opportunities, and threats relevant to building a smart, modern tax and customs administration. Overall, both external and internal factors present a more challenging operating environment to achieve a more acceptable level of voluntary compliance, which currently stands at around 68%. Modernisation priorities include digital transformation, AI integration, data-driven compliance, and enhanced stakeholder collaboration to achieve voluntary compliance, efficient revenue collection, and effective trade facilitation. 4.1 Internal Factors SARS has made significant progress over the past six years in rebuilding institutional capacity, emphasising governance, digital innovation and artificial intelligence, as well as the development of our people. The current level of capacitation, however, renders SARS less than optimal in executing its legal mandate. This will require, among other things, a significant review of government investment in SARS, as well as strengthening the governance and independence of the institution from external interference. Persistent resource constraints, skill gaps, and operational inefficiencies continue to hinder full mandate fulfilment, despite notable advancements. This has adverse implications for the long-term fiscal integrity of South Africa. 4.1.1 STRENGTHS » Institutional Progress and Performance: • Achieved clean audit reports successively, indicating good governance and a generally healthy control environment; • Employee engagement increased from 61.6% to 71%. • On our core mandate: » the 6-year CAGR revenue growth has been 7% in an economy that has grown nominally by around 3.7% CAGR; » the voluntary compliance index rose by 4 percentage points to 68%,
SARS Modernisation White Paper 2025/26 – 2029/30
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