Tax Ombud still aims for true independence

Despite criticism that extension of mandate introduces another hurdle.

JOHANNESBURG – The Tax Ombud has expressed the hope that his office will, over time, develop into an entity on its own, accountable to the Minister of Finance but with “full legal capacity”.

Speaking to Moneyweb a few days after his term was extended by three more years from October 1, judge Bernard Ngoepe (pictured) said because his office is not an entity like the Financial Services Board (FSB) or other institutions it can’t “do things in its own name”.

Being a full legal entity would mean that it could enjoy more autonomy and could do things of its own accord, although it would still be answerable to the Minister in terms of its activities, he said.

The Office of the Tax Ombud was set up to offer a free and simple remedy to taxpayers with complaints related to administrative issues, poor service or failure by the South African Revenue Service (Sars) to recognise taxpayer rights. 

But from the outset its independence has been a point of contention. Since the office effectively plays a watchdog role, it is important that it should be independent of Sars.

Proposals to improve its independence have now found their way into the Draft Tax Administration Laws Amendment Bill, including that it would have control of its budget (which the minister would determine) and would in due course have the capacity to employ staff directly and not via Sars.

Should these amendments be introduced as expected, it should address some of the concerns around the office’s independence.

However, a proposal that will extend the mandate of the Ombud to investigate and review any systemic issues related to a service matter at the request of the minister has been met with criticism as industry stakeholders argue this is yet another hurdle in the journey towards full independence.

Ngoepe said their “primary thinking” is that it is important for the office to be able to investigate systemic service issues without a request from the minister.

The Office has done a comparative study with similar institutions in some other countries and has found that some of them do have the capacity to initiate investigations on their own.

Although this is what was initially proposed, Ngoepe said he got the impression that there was some concern that the office would abuse such powers.

“As a compromise and without abandoning our initial position… we suggested that … the Tax Ombud would, with prior approval by the minister, investigate whatever items the Ombud feels… should be investigated.” He noted that the requirement of prior approval by the minister should allay concerns that the Ombud could abuse its powers.

Ngoepe said in his view it is unlikely that the minister could just refuse approval for an investigation if there is a good motivation to conduct such an investigation.

When asked if the Office has already identified such systemic issues that it plans to take to the minister for potential investigation, Ngoepe said even if there were, he would not be able to share these issues, as he is about to submit his annual report to Parliament. This is expected to happen on September 30.

Practically speaking, an example of a potential systemic service issue could include constant, continuous delays in the issuance of VAT certificates.

Ngoepe said if his office repeatedly receives complaints of this nature and does not understand why there is such a significant delay, which could result in businesses suffering huge financial losses, it could potentially be investigated.

“It may be so prevalent and so persistent that one would want to delve into it to understand why … an investigation might help.” For example, Sars might investigate to identify some weakness in its system and then remedy the situation.

Ngoepe said any investigation or report given to Sars about certain complaints is aimed at helping it to correct and improve its system from time to time, however perfect it may be.

“As people say, there is always room for improvement.”

“Our basic motivation … is to assist Sars in collecting as much tax as possible and in as fair a manner to the taxpayer … as possible. We want to encourage tax compliance by the taxpayers. If they feel they are being treated fairly, then that would encourage tax compliance on their part.”



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I am confused. If the Tax Ombud receives repeated complaints, it seems he can already review a systemic issue of the kind he describes. Have a look at (1) and (2)(f) at

If he wants to review issues even if there are no complaints I can understand why a check and balance is being proposed.

End of comments.




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