In the ever-evolving tax landscape and public domain, one name strikes fear into the heart of non-compliant taxpayers, and confidence for the law-abiding residents of South Africa: Commissioner Edward Kieswetter!
Jashwin Baijoo
Head of Strategic Engagement & Compliance
Taryn Govender
Admitted Attorney
On 27 February 2024, President Cyril Ramaphosa made a significant announcement that is likely to shape the trajectory of SARS – the unprecedented 2-year tenure extension of Commissioner Kieswetter. Call it what you may, but it is no happy coincidence that on the same day, the Commissioner confirmed SARS has instituted legal proceedings against Sasfin Bank.
A strong statement to financial and governmental institutions – in the war on non-compliance, Kieswetter takes no prisoners!
For SARS, Kieswetter has been the saving grace, a knight in shining armour, coming in to clear the battlefield littered with victims of Tom Moyane’s reign over SARS. Kieswetter commenced his tenure with SARS in 2019, initially slated for a five-year term which began on 1 May 2019. Over the years, the Presidency has demonstrated consistent confidence in Kieswetter’s abilities to restore SARS’ reputation, a belief that hindsight has proven to be accurate.
Over the course of his tenure at SARS, Kieswetter has proven to be the General at the forefront of battle, be it against illicit trade, tax collections, or embodying SARS’ strategic objectives. His active involvement and hands-on approach have not only strengthened SARS’ revenue collection capabilities but also bolstered its reputation as one of the most formidable and well-recognized tax institutions in the world.
When it comes to SARS’ war on non-compliance, no punches have been pulled, and strategic initiatives such as the creation of the High-Wealth Individual Unit and outsourcing of debt collections to bolster SARS’ reach and capacity have been the bane of existence for non-compliant taxpayers. Despite his many achievements, Kieswetter was initially content to contemplate his retirement as his term was approaching an end on 30 April 2024.
His readiness to step down, however, was short lived when President Ramaphosa intervened by urging him to once more lead the charge, which Kieswetter did not shy away from!
In accepting this extension, Kieswetter is quoted saying:
“I can assure all South Africans that, with your support, SARS will spare no effort and continue to work hard to ensure that the vision of a Smart, modern SARS with unquestionable integrity, admired by all is achieved. SARS remains inspired by the transformative and Higher Purpose of serving all South Africans”.
On the same day of his extension of term, and as a matter of Public Interest, Kieswetter publicly announced that SARS has now instituted legal proceedings against Sasfin Bank. When viewed against the backdrop of SARS’ recent pursuit of other big fish like Impulse International (Pty) Ltd, Eskom the Petroleum Oil and Gas Corporation of South Africa, it is evident that Kieswetter has zero-tolerance for fraud and non-compliance of any nature. It is strong statements like these which serve to caution taxpayers against tax non-compliance and tax evasion in the upcoming years.
The legal battle follows from an investigation into Sasfin Bank, and other prominent corporation, who failed to make true and accurate disclosures to SARS. The investigation revealed not just incorrect disclosures, but also collusion in expatriation of funds offshore, to the extent of tax evasion.
Whilst Sasfin had already received a summons on 09 January 2024, claiming a total amount of R4,872,327,649.27 plus interest and costs in the form of a damages claim, key stakeholders are adamant that this amount is comprised of tax debts due by former foreign exchange clients and not the bank itself. To this effect, the bank is building their defences, but the question remains – will it be enough to halt an assault launched by a seasoned General like Kieswetter?
When it comes to your tax affairs, and in order to protect yourself from SARS, it remains the best strategy that you always ensure compliance.
Where you find yourself on the wrong side of SARS, there is a first-mover advantage in seeking the appropriate tax advisory, and legal muscle, ensuring the necessary steps are taken to protect your war chest from being raided. However, where things do go wrong, SARS must be engaged legally, and we generally find them utmost agreeable where a correct tax strategy is followed.
As a rule of thumb, any and all correspondence received from SARS should be immediately addressed, by a strong multi-faceted tax, legal, and financial team. This will not only serve to safeguard you against SARS implementing collection measures but also being specialists in their own right, you will be correctly advised on the most appropriate solution to ensure your tax compliance.
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