Despite Economic Challenges, SARS Sets Record with R2.3 Trillion Collection in 2024/25

Johannesburg – The South African Revenue Service (SARS) has reported a historic gross revenue collection of R2.303 trillion for the 2024/25 fiscal year, demonstrating 6.9% year-on-year growth compared to an estimated nominal GDP growth of 5.4%.

In spite of challenging economic conditions, SARS disbursed R447.7 billion in refunds, marking the highest amount ever, which has bolstered economic activity.

Net collections totaled R1.855 trillion, surpassing revised forecasts by R8.8 billion.

Key Highlights

• Tax-to-GDP ratio stands at 24.8%, indicating robust fiscal health.
• Tax buoyancy at 1.20, demonstrating that revenue growth is outpacing GDP.
• Refund fraud prevention efforts resulted in SARS blocking R146.7 billion in fraudulent claims.

SARS Commissioner Edward Kieswetter remarked: “I am pleased that the R447.7 billion returned to taxpayers is beneficial for the economy. However, I remain highly concerned about the persistent threat of refund fraud and the misuse of our system.”

Sector Performance

• Personal Income Tax (PIT): Increased 12.6% (R81.8 billion), supported by PAYE from the Finance and Community sectors and Two-Pot withdrawals (R12.9 billion versus R5 billion projected).
• Company Income Tax (CIT): Grew 2.1% (R6.5 billion), primarily due to profits in the Finance sector, while the Mining sector saw a decline.
• VAT: Net collections increased 2.3% (R10.5 billion), with R365.5 billion in refunds (6.6% growth). R127.4 billion was allocated to SMMEs.

Compliance & Enforcement

SARS utilized AI, data analytics, and machine learning to improve compliance, resulting in R301.5 billion generated through various interventions, including:

• R94 billion from resolving 3.7 million debt cases.
• R103 billion from 1.7 million AI-driven verifications.
• R59 billion from 230,000 audits.
• R30 billion from 198 investigations into syndicated crime.

Future Plans

With an additional R7.5 billion allocated by Finance Minister Enoch Godongwana, SARS aims to:

• Enhance enforcement against illicit trade, money laundering, and cybercrime.
• Modernize tax and customs systems.
• Expand Auto-Assessment initiatives, which achieved 98% uptake in 2024/25.

Kieswetter concluded: “I extend my sincere gratitude to all South Africans, particularly compliant taxpayers and traders, for consistently fulfilling your legal obligations.

“We are continuously working diligently to make your experience with SARS straightforward and seamless.”

SARS remains dedicated to voluntary compliance, broadening the tax base, and encouraging fiscal citizenship to support South Africa’s economic advancement.

SARS is a cornerstone of our cherished democracy

Since its inception, it has collected over R23.3 trillion to aid in the establishment of a capable state that serves everyone.

This achievement is indelibly connected to an efficient and effective revenue administration that fulfills its legal obligation to collect all dues to the fiscus, foster compliance, and facilitate legitimate trade.

“As an organization, our mission revolves around the transformational impact we have on people’s lives, a notion we refer to as our ‘Higher Purpose’.

“We are committed to reimagining our organization into a smart, modern SARS that garners trust and admiration from all, as encapsulated in our Vision 2025–2030.”

*This article first appeared in our sister publication techfinancials.co.za