ActionSA has rejected the proposed budget cuts to the South African Revenue Service, saying that the institution in charge of running the nation’s tax and customs services will be severely damaged by the decision.
ActionSA has rejected the proposed budget cuts to the South African Revenue Service (Sars), saying that the institution in charge of running the nation’s tax and customs services will be severely damaged by the decision.
ActionSA has called on the Government of National Unity to ensure that critical institutions are sufficiently funded to give full effect to their mandates.
According to ActionSA MP Alan Beesley, reducing budget cuts will adversely impact the ability of Sars to collect revenue and perform its mandate effectively, potentially affecting the overall fiscal balance sheet.
‘“As outlined in the proposed budget, Sars faces substantial cuts, with a nominal reduction of R769 million and a real cut of R1.3 billion, which we contend are unworkable and thus, demand reversal.
‘“Owing to the critical role that Sars plays in collecting over 90% of the government’s revenue, ActionSA believes it is ill-advised to further limit the capacity of the revenue collector,’’ Beesley said.
In addition, Beesley said that if Sars cannot operate at full capacity, it will lead to constraints on the fiscal coffers.
Beesely said that by cutting Sars’ budget, the government is biting the hand that feeds it, which defies all logic.
Furthermore, Beesley said ActionSA believes that it is ‘’nonsensical’’ that while essential state functions like Sars and even the judiciary suffer under broad austerity measures, the billion-rand perks of a bloated Cabinet remain seemingly untouched.
Rather than cutting Sars’ budget, the revenue service should be further capacitated to increase revenue collections by targeting the political elite and other criminal syndicates that, through illegal activities, remain outside the tax net, Beesley said.
