South African Revenue Service (SARS) Commissioner Edward Kieswetter has revealed that around 100,000 people in South Africa who earn over R1 million annually are not registered for tax. SARS has already identified 30,000 of these individuals using new data analysis tools.
The government has allocated an extra R7.5 billion to SARS over the next three years to help modernise its systems and improve tax collection.
This funding will support efforts to bring these high earners into the tax system, potentially adding R100 billion to national revenue.
The tax body’s latest data shows that approximately 342,000 people in South Africa have a taxable income exceeding R1 million, contributing around R225 billion to personal income tax, which is around 45% of the total it assessed.
Kieswetter said at the News24 Budget Breakfast on Thursday that a significant portion of South Africa’s uncollected revenue, estimated at R800 billion, comes from unpaid taxes and returns that have not been filed. The rest is linked to tax evasion and illegal financial activities.
SARS is using technology to track non-compliant taxpayers and is already targeting 156,000 people whose earnings now exceed the tax threshold.
The agency is also making it easier for people to file taxes by automating the process. In fact, 98% of the five million automatically assessed taxpayers accepted their results, compared to just 3% in previous years.
Over the next three years, SARS will spend R500 million each year on modernising its systems and improving efficiency. The goal is to reduce the R800 billion gap in unpaid taxes by using data and technology to identify those who aren’t complying with the tax laws.
