ARABILE GUMEDE: Sars itself is aiming at tweaking perhaps some of its targets and perhaps relooking at tax collection as wealth. Just how that is it going to work – we want to chat quickly to the acting commissioner of the South African Revenue Service, Mark Kingon. Mark, thank you so much for joining us on the line. Exactly what are your plans and what are you aiming to look at, precisely, with regard to changing Sars?
MARK KINGON: Good morning to you and your listeners. It’s good to have a chat. Revenue collection is never static. And so we’ve had two years of the operating model as we called it, the new operating model, that has been very much in the media and we are aware that in the past year in revenue collections we obviously did not reach the target, and of course the target was adjusted. So obviously the status quo can’t remain. We need to tweak things to ensure that we are collecting the revenue that government needs.
ARABILE GUMEDE: When you say tweaking, are you tweaking with regard to personnel or is it systems that you find are problematic?
MARK KINGON: It’s everything that would impact revenue collection. So some of the specific areas that we need to look at are indicated as you would have seen with regard to large business – are we serving them adequately and are we enforcing compliance on them correctly? We need to look – what is the optimal model that we can implement to ensure that we are rendering a good service to the large business sector. So that’s one of the aspects.
In parliament last week the whole issue of illicit tobacco and the illicit flows flowing from that, we have to be relooking at how we are doing it to ensure that we are curbing these illicit flows that are happening as the result of this trade.
ARABILE GUMEDE: Now-suspended commissioner Tom Moyane disbanded the large business centre more than two years ago. Any plans of bringing that back?
MARK KINGON: That’s part of the things that we are looking at on the table – what is the best way to serve them? At this point in time I’ve got a team that is looking at that and we will be making some announcements. What is the best way that we can serve the large business sector? It’s interesting that today you are having the discussion with the practitioners in the market and it’s those type of people we will also be engaging with to understand what they perceive the needs to be, what does large business see the needs to be, and obviously what are the risks to compliance in the large business space. As we look at large business, their revenue flows have been rather flat over the last few years and that could be also obviously driven by the economy. But to the extent that it’s in our control, we want to be dealing with that.
ARABILE GUMEDE: The economy is said to be looking a little bit better. Of course, growth expectations are looking a little higher. If you inputted all of this into your models, does your tax collection estimate look to be going higher or lower at this point?
MARK KINGON: At this point it’s too early to tell. We are only a month into the new financial year. It’s far too early to know. And obviously the effect of the adjustments to VAT and other tax changes that happened from budget – we are yet to see those. For instance, the sugar tax was only just implemented. As I said, the VAT rate just implemented, the personal tax changes, minor changes there, we’ll see how that progresses into the year. But we are committed to do our best to ensure that we give government as much as we can in terms of the scope and law that we have.
ARABILE GUMEDE: Very difficult and a tough road ahead for you, Mark Kingon. Thank you so, so much for your time.