SARS tax surplus to be eaten by refunds
Linda Ensor | 2017-03-28 12:37:31.0
The tax authority‚ led by commissioner Tom Moyane‚ briefed MPs on its performance for the three months to end-December. File photo
Image by: Trevor Samson
A surplus of R500 million would be consumed by the payment of backlog tax refunds‚ the South African Revenue Service (SARS) told Parliament’s finance committee on Tuesday.
Revenue collection by end-December of R818.8 billion represented a surplus of R500 million on the target set out in the medium-term budget policy statement (MTBPS) but the surplus would be consumed by the payment of backlog tax refunds‚ the South African Revenue Service (SARS) told Parliament’s finance committee on Tuesday.
The tax authority‚ led by commissioner Tom Moyane‚ briefed MPs on its performance for the three months to end-December.
The surplus was expected to become a deficit due to the refunds‚ the tax authority said in a written submission to the committee.
“The saving in VAT refunds was depleted when the December 2016 backlog was cleared largely in January 2017‚ thus posing a downside risk to overall revenue collections‚” SARS said.
Total VAT refunds amounted to R133.4 billion by end-December.
SARS warned that import taxes posed the most significant risk to revenue collections due to subdued levels of growth.
It noted that customs duties by end-December had generated R32.8 billion compared with the MTBPS target of R35 billion‚ while specific excise duties of R24.7 billion had been collected‚ against the targeted R25 billion.
Gross VAT collected on imports amounted to R106.4 billion‚ against the targeted R110.4 billion.
SARS attributed the lower collections on import VAT and customs duties “to the subdued growth levels of merchandise imports resulting from rising import costs and weak domestic activity dampening the demand for consumption and capital goods.”
Personal income tax collections were R1.8 billion lower than the MTBPS target due to higher refunds‚ lower than expected provisional payments and higher employment tax incentive credits.
Gross personal income tax receipts by end-December amounted to R317.7 billion‚ compared to the MTBPS target of R318.6 billion.
After refunds of R18.9 billion (target R18 billion)‚ net personal income tax receipts amounted to R298.8 billion against the targeted R300.6 billion.
Gross corporate income tax collections at R161 billion were R2.7 billion higher than the MTBPS target‚ mainly due to higher than expected provisional tax payments. Corporate tax refunds amounted to R9.8 billion.