July deadline for SARS to respond on delayed refunds

Johannesburg – The South African Revenue Service (SARS) has until the end of July to review and add its responses to the issues raised in a provisional report based on an investigation by the Tax Ombud.

Tax Ombudsman Judge Bernard Ngoepe spoke to Fin24 on Thursday, where he gave an update on the progress of the investigation into the tax authority related to delayed refunds, launched earlier this year.

Ngoepe previously told Fin24 that the office decided to launch the probe given the level of complaints received about the refunds. He said that the issue is not related to governance, but rather the mechanisms applied by the tax authority.

Former Finance Minister Pravin Gordhan told Parliament that the tax authority delayed payment of R19.6bn worth of VAT refunds by the end of February 2017.

Ngoepe told Fin24 that hundreds of complaints are being investigated, which started as far back as the office of the Tax Ombud was formed. The complaints continued to pour in even after the probe started. “It is a continuous thing.”

“We have investigated the complaints against SARS. We have produced a provisional report. We gave SARS a copy of the provisional report on Monday,” he said.

SARS has an opportunity to go through the report and comment or respond to issues raised. “We gave them opportunity to put forward their own version so that we can have a balanced picture to finalise the report,” said Ngoepe.

SARS has until the end of the month to get back to the Tax Ombud. “That was our suggestion to them, thereafter we will start working on the final report.”

Ngoepe could not go into the details of the report, and said it would be premature to comment on the findings until SARS has an opportunity to respond. “Let us just see what the responses of SARS are to the issues then we can draw up the final report.”

Previously Ngoepe said that his aim is for the process to be fair and that he would be objective in his duty. Ngoepe said that all stakeholders were given an opportunity to share information. “The process has been fair and objective,” he said.

Public interest

Ngoepe said it is important to update the public on the progress of the investigation. He advised South Africans to first raise their complaints with SARS before looking to the Tax Ombud. Once internal mechanisms at SARS are completed, then taxpayers could consider reaching out to the Tax Ombud to pick up complaints.

Usually complaints that reach the Tax Ombud first are referred back to SARS. But in exceptional circumstances the Tax Ombud would deal directly with complaints. 

Ngoepe said that any recommendations to be made in the final report are not binding on SARS, but that he hopes they would consider them in the interest of good governance.

The tax season was launched on Monday. Commissioner Tom Moyane said the tax revenue target is R1.265trn. More than 50 000 people have filed electronically since July 1.

“We want to confirm we are serious and committed to giving excellent service … We are serious about paying back the money where it is due,” he said.

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