Main Menu

South Africa Achieves a 9.6% Revenue Gain In The 2014/2015 Fiscal Year

World Affairs

Open Eyes Opinion {source: SAgov}

South Africa


Pretoria
– Despite challenging economic conditions the South African Revenue Service (SARS) has seen a 9.6% growth in total revenue in the 2014/15 fiscal year.

“Despite challenging economic conditions, SARS collected R986.4 billion, which is a 9.6% growth in total revenue from 2013/14,” Finance Minister Nhlanhla Nene said as he announced the revenue service’s preliminary revenue collection results for the 2014/15 financial year.

This was R7.4 billion above the revised estimate announced in the February 2015 Budget, Minister Nene said on Wednesday.

Briefing reporters in Pretoria, the Minister said the revenue performance was made possible by an extraordinary drive by SARS on compliance improvement, which in aggregate added about R22 billion.

“This closing of the compliance gap compensated for revenue collection shortfall caused by a slowing economy,” he said.

The successful outcome of the 2014/15 revenue drive lifted the estimated tax-to-GDP ratio from the 25.2% anticipated in the 2015 Budget to 25.4%.

The Minister said the numbers show the efficacy of the revenue service.

“The numbers that we report today are proof that SARS is an efficient and stable institution that we should all be proud of,” he said.

The contributors to the revenue collection were Personal Income Tax (PIT), Corporate Income Tax (CIT) and Value Added Tax (VAT).

PIT total collections were R353.8 billion, which is R3 billion above the revised estimate in the 2015 Budget of R350.7 billion. CIT total collections were R186.9 billion, R2.3 billion above the revised estimate in the 2015 Budget of R184.6 billion.

VAT total collections were at R261.1 billion, R500 million higher than the revised estimate in the 2015 Budget of R260.6 billion.

The robust collections performance from SARS is expected to have a positive impact on the fiscal framework.

The 2014/15 collections target, based on a 2.9% GDP growth outlook, was set at R993.6 billion in the February 2014 Budget announcement.

Revenue growth remained resilient as the rate of economic growth slowed.

“This resilience was a reflection of two things, the first being the significant improvements in compliance by SARS and the policy changes that were introduced earlier. The combined effect of these measures is an increase in revenue,” said the Minister, adding that compliance measures yielded R22 billion.

“The significant increase in the vesting of shares added R8.6 billion to revenue.”

Subsequent to this announcement, the real GDP growth was revised down to 1.4% in the February 2015 Budget. This was as a result of tentative global economic performance and domestic supply side constraints. The latter included the impact of strikes on the mining and manufacturing sectors as well as prospects of significant load shedding.

As a result, in the February 2015 Budget, the 2014/15 revenue estimate was revised downwards by R14.6 billion to R979 billion.

The Minister said that National Treasury is supportive of SARS.

“We at National Treasury are supporting the commissioner [SARS Commissioner Tom Moyane] and his team in their efforts to perform their core function of revenue collection,” said Minister Nene, who also thanked taxpayers and traders for paying their taxes.

Moyane said: “The outstanding return and revenue numbers you’ve announced are just a testimony that South Africans and taxpayers have spoken and without doubt demonstrated their confidence in SARS.”

While tabling the 2015 Budget in February, Minister Nene announced the appointment of an advisory committee to attend to governance matters at SARS.

Giving an update on the panel, Finance Deputy Minister Mcebisi Jonas said: “On the advisory panel, we are taking a medium- to long-term perspective on the work of the panel. Ultimately we see it as a mechanism for strengthening tax administration in South Africa, supporting SARS and Treasury in that regard”. –SAnews.gov.za

###

 

 

Click here for reuse options!
Copyright 2015 openeyesopinion.com





Comments are Closed