SOUTH AFRICA - SARS COLLECTS OVER R1 TRILLION FOR THE FIRST TIME IN COUNTRY'S HISTORY

SARS collects R1.0699 trillion in 2015/16

Pretoria - The South African Revenue Service (SARS) has collected R1.0699 trillion in taxes for the 2015/2016 financial year.

Speaking at a media briefing to release the the preliminary outcomes of revenue collection - that was also attended by Finance Minister Pravin Gordhan - SARS Commissioner Tom Moyane said this is the first time the revenue service has collected more than a trillion rand.

"The achievement of the target of a trillion rand is momentous, historical and a first for South Africa," said the Commissioner.

He said the primary types of tax that contributed to the revenue performance were among others Personal Income Tax with total collections at R389.3 billion. This is R 35.3 billion higher than the R353.9 billion outcome of the previous financial year.

Corporate Income Tax collections came to R193.5 billion which is R6.9 billion higher than in the previous financial year.

Meanwhile, Value Added Tax (VAT) collections were at R280.8 billion.

Commissioner Moyane said SARS was forced to think outside the box in meeting the revenue collection target given the headwinds faced by the global economy.

Speaking at the briefing, Minister Gordhan said tax revenues are generated from economic activity. When business confidence and investment are declining, economic growth tends to fall, dragging down tax collections.

“In the past few years, National Treasury has consistently had to revise down projected tax revenue, in line with weaker economic growth. Despite maintaining an expenditure ceiling over the past four years, the shortfall in taxes has produced a persistently large budget deficit,” said the Minister.

Minister Gordhan said that between the 2015 and 2016 budgets, projected tax revenue for 2015/16 was revised down by R12 billion.

He added that tax revenues have been marginally more resilient than government had anticipated.

He attributed the growth to tax collection to the hard work and dedication of the 14 500 staff compliment of SARS.

“Initial indications are that the revised deficit as published in the 2016 Budget Review is broadly achievable. It is clear that the global economy is not going to be helpful over the next few years.

“We need to redouble our efforts to increase policy certainty, catalyse entrepreneurship, innovation and the joint experience of the private sector and the public sector so we can grow this economy,” said the Minister.

“Notwithstanding today’s revenue outcome, the growth expectation of 0.9 per cent for 2016 is not nearly enough to generate the kind of revenue that enables us to fund all of government’s programmes. Our focus on fiscal commitment should remain. We cannot spend money we do not have,” he added. – SAnews.gov.za