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Presentation to the Standing Committee on Finance
19 October 2011
Slide 2: SARS collected a record R674 billion in 20 10/11, continuing its high-growth trajectory
Total tax revenue collectedR billion
674
599625
573
496
417
+11.8%, p.aSARS has
achieved 417
355303
252220201184165
147127113
282
1994
/95
1995
/96
1996
/97
1997
/98
1998
/99
1999
/00
2000
/01
2001
/02
2002
/03
2003
/04
2004
/05
2005
/06
2006
/07
2007
/08
2008
/09
2009
/10
2010
/11
1994
/95
1995
/96
1996
/97
1997
/98
1998
/99
1999
/00
2000
/01
2001
/02
2002
/03
2003
/04
2004
/05
2005
/06
2006
/07
2007
/08
2008
/09
2009
/10
2010
/11
double-digit
revenue
collection
growth since
1994
Source: SARS 2010/11 Annual report page 11 and SARS internal data 2
Slide 3: Cost of revenue collection remains stable
+18
+7
Cost of revenue collection
674
599625
573600
700
1.0
1.2
Tax revenue
Cost to tax revenue ratio
R billion %
496
417
0
100
200
300
400
500
0.0
0.2
0.4
0.6
0.8
2010/112009/102008/092007/082006/072005/06
Source: SARS 2010/11 Annual report page 18 3
Slide 4: The growth rate of debt due to SARS has be en reduced
79
61
86
+30%
+9%
+18
Debt dueR billion
2010/112009/102008/9Source: SARS 2010/11 Annual report page 24 4
Slide 5: Compliance and Enforcement achievements
81% of individual taxpayers filed their tax returns on-time
11% reduction in outstanding returns compared to previous FY
R17.7 billion rand recovered from the debt book
48% growth in the overall tax and trader register
Strategic plan
measures (pg 50-58)
~80 000 audits conducted; ~6 500 investigative audits completed
83% of investigative audits conducted by SARS were successful and netted R3.9 billion in audit yield (cash collected on raised assessments and reduced refunds)125 000 taxpayers issued penalties for outstanding returns; additional R191 million collected in revenue from these penalties
23 580 seizures completed with a protected value of R994 million
R765 million collected through post-clearance audits
Other compliance
and enforce-
mentindicators (pg 20-27)
Source: SARS 2010/11 Annual report pages 20-27 & 50 -58 5
~80 000 audits conducted; ~6 500 investigative audits completed
65% success rate in litigation cases
Slide 5: Service achievements
85% first contact resolution in contact centres
15 days average turnaround time for escalations
79% of entities operating from SACU countries submit declarations electronically
>6 million e-Filing users – 12 times greater than 5 years ago
Strategic plan
measures (pg 50-58)
3 million calls handled by the call centre during Tax Season
186 000 (4.2%) of returns submitted on paper – down from 345 000 (8%) last year
1.7 million returns (38%) submitted through branches
Other service
indicators (pg 20-27)
Source: SARS 2010/11 Annual report pages 20-27 & 50 -58
2.7 million returns assessed within 24 hours – 18% improvement
79% of refunds paid within 48 hours
6
Slide 7: Human Capital levels and Employment Equity ratios have remained stable
32 32 31White
100% = 15,296100% = 15,263100% = 15,307
Human Capital and Employment Equity%
Women ratio = 61%
PDI in mgmt> 60%
11 11 11
51 51 52
Indian
Coloured
2010/2011
6
2009/10
6
2008/09
6
African
Disability rate = 2.13%
= 61%
Women in mgmt~ 45%
Source: SARS 2010/11 Annual report pages 33-35 7
Slide 8: SARS continues to exercise the utmost prud ence when utilising taxpayer funds
Lease costRm
Travel costsRm
PIC
DPW
462
412 2514
3 12
Domestic S&T
International travel
97
79
47
125
104
x% Cost as a % of total expenditure
# of
properties
144
# of
properties
163
SARS adopts a lease policy to adapt quickly to taxpayer demographics (commercial centres, public transport routes, etc.)
SARS has strict controls in place to manage travel costs (e.g. use of low-cost airlines, discounted rates at hotels, strict employee acquittal rules)
2010/11
Private Leases
423
2009/10
396
Domestic air travel
Domestic accommodation
2010/112009/10
34
47
28
36
1.3%1%1.1%7%5%
Source: SARS internal data 8
144163
Slide 9: Areas where we did not meet our goals for 2010/11
92% of our leadership positions filled (against a target of 95%)
The roll-out of the new operating model resulted in a few leadership positions not being filled
99.3% of our employees placed on career model (against a target of 100%)
Newly appointed employees have not been placed as no career data is available for them yet.
Achievement against target Commentary on performance
them yet.
49.5 % employee engagement achieved in 2010/11 (against a target of 55%)
Employee engagement has shown an improvement over 2009/10 level (47%)
Implemented the Preferred Trader segment (along with Large Business and Standard Individuals) instead of the Medium Business segment
There was a need to increase compliance and modernise the Customs environment
Source: SARS Annual report pages 52-58 9
Slide 10: Global and local collaboration with other stakeholdersStakeholder Description of collaborative efforts
ATAF
OECD
WCO
SARS continues to play leading roles in many international multi-lateral tax and customs forums like the OECD and the WCO, including seconding key leaders into these organisations
SARS holds the Chairperson’s position and the position of the interim secretariat of ATAF
WCO
DHA
SAPS
SSA
SANDF
SARS continues to lend support to fellow government agencies to build world class systems
SARS has formed strategic relationships with a number of Intelligence and Defence force agencies to ensure continuous growth. This has enabled the initiation to form the Inter Agency Clearance Forum (IACF) to enhance the coordination and cooperation amongst the various agencies.
organisations
Source: SARS internal data 10
Thank youThank you
11
SA’s cost of revenue collection compares favourably to other countries…
1.02
0.80
0.58
0.97
0.79
Australia
Spain
Singapore
Germany
New Zealand
Comparison of aggregate administrative costs to net revenue collections, 2009%
SA’s cost of
revenue collection
is in line with
1.14
1.44
1.37
1.33
1.20
1.11
1.11
1.08
1.02
1.14
Portugal
Bulgaria
Canada
Italy
Argentina
UK
South Africa
Netherlands
Ireland
Australia is in line with
international
norms and
developed
countries (e.g.
UK, Netherlands)
12