SARS said to be planning ‘AmaBillions’ blitz to collect outstanding tax, plug fiscal hole

THE cancellation of Treasury’s controversial Value Added Tax (VAT) increase has left a fiscal hole of around R75 billion in South Africa’s medium-term budget, and this will reportedly see a renewed focus on tax dodgers.

According to unnamed sources, the South African Revenue Service (SARS) is planning to recruit at least 500 new employees to pursue outstanding tax revenue.

The initiative, which reportedly goes by the name of “Project AmaBillions”, will aim to recover at least R70 billion in tax revenue. It will target “low hanging fruits” such as undisputed tax debt.

It is believed that outstanding taxes owed to the revenue service currently amount to around R300 billion. 

Although SARS has not officially announced such a project, it does potentially tie in with the new Compliance Programme outside of the normal revenue collection stream, which was announced by Commissioner Edward Kieswetter during the preliminary Revenue Collection Announcement on April 1.

He said SARS would target uncollected tax debt as well as people above the threshold who are currently not registered for tax.

Keitumetse Sesana of the SA Institute of Taxation said that although she was not aware of a ‘special project’ at SARS, Kieswetter’s remarks made it clear that the revenue service would use its additional budget allocation of R7.5 billion to focus on debt cash collection and pursue over 5 million outstanding returns, as these would be “easy wins” for closing the tax gap.

“For many years, the SAIT has said that introducing new taxes is not the way to strengthen the state coffers,” Sesana added.

“We must go after the money in the system, owed to the fiscus but not reaching SARS. Non-compliant taxpayers must be made to pay their fair share. Only thereafter can South Africa consider introducing new taxes.”

Sesana said it was likely that many recruits would be brought into SARS, with a focus on manual phone calls, as this method is believed to be the most effective way of nudging taxpayers to settle their debt.

But what does this mean for South Africans who find themselves in the crosshairs?

Jashwin Baijoo, Associate Director at Tax Consulting South Africa, says:

“In practice, what we have seen is SARS increasing its collection drive on outstanding tax debts, in an effort to eradicate tax non-compliance. That being said, SARS remains open to discussions on payment arrangements and tax debt write-offs where taxpayers face financial hardship.”

Baijoo said SRS has written off R36.15 billion in the 2023/24 financial year.