In preparation for the upcoming tax filing season, the South African Revenue Service (SARS) is believed to work on a major special initiative focused on tax debt collection, which is expected to yield an additional R70-billion in revenue over the next three years.

It is understood that in the hallways at SARS officials aptly refer to this as Project AmaBillions.

Reliable information has it that SARS plans to or have already started recruiting 500 additional employees to work on this project, with another possible 500 to 1 000 appointees later.

For now, SARS has neither confirmed that work on such a project is underway or provided any detailed information, but with revenue collection under pressure, it should come as no surprise that the tax man is stepping up efforts to go after low hanging fruit such as undisputed tax debt. 

Some believe the assessed outstanding taxes owed to SARS is as high as R300-billion.

Interestingly, the figure of around R70-billion, if correct, closely aligns with National Treasury’s estimated shortfall of around R75-billion over the medium term due to the withdrawal of the VAT rate increase as proposed in Budget 2.0. 

Pulling no Punches When it Comes to Debt Collection

Keitumetse Sesana, Strategic Lead for Stakeholder Engagement and Legislation at the South African Institute of Taxation (SAIT), says she is not aware of a special project in the works, but from the strategic pillars Commissioner Edward Kieswetter referred to during the preliminary Revenue Collection Announcement on 1 April 2025, it is clear that uncollected tax debt is a focus area.

Kieswetter mentioned a Compliance Programme outside of the normal revenue collection stream where SARS is specifically going after uncollected tax debt, as well as people above the threshold and with significant income who are not registered for tax.

Sesana says the Commissioner’s remarks clearly signalled SARS’ intention in the short to medium term to use the additional allocation of R7.5-billion from National Treasury to reduce its balance sheet by focusing on debt cash collection and pursue the more than 5-million outstanding returns.

“These are the easy wins SARS is going for to help close the tax gap of around R800-billion.” (The tax gap refers to the theoretic estimate of how much tax revenue could have been collected and what SARS actually collected.)

SARS’ Compliance Programme interventions in 2024/25 generated R301-billion in compliance revenue, representing a 15.8% year-on-year increase. A total of 1.7-million verification cases and resolving over 3.7-million outstanding tax debt cases and outstanding returns, largely contributed to the success. 

Jashwin Baijoo, Associate Director and Head of Strategic Engagement & Compliance at Tax Consulting South Africa, says the launching of a Focused Revenue Recovery Programme aligns completely with SARS’ compliance themes of debt cash collection and outstanding returns collection, per the 2025 Revenue Collection Announcement.

Strengthening SARS Is Crucial for the Task Ahead

Sesana says some of the additional funds allocated to SARS over the medium term to improve its administrative efficiencies, will go to recruiting more employees. Earlier the Standing Committee on Finance recommended an allocation of R1.5-billion to support the hiring of 2,338 additional resources, saying strengthening SARS’ human resources is vital for improving service delivery, enforcing compliance and effectively utilising data analytics in tax administration.

She adds that from discussions with role players in the tax industry, it is evident that manual phone calls are still the best way to follow up and nudge taxpayers to settle their tax debt with SARS and therefore many new recruits will be brought in to enhance compliance. Kieswetter said during the Revenue Announcement part of the Compliance Programmes success is attributed to 20-million service-related interactions at SARS branches, via the phone or through its digital self-service platforms assisting taxpayers to comply.

Where does this leave taxpayers and tax practitioners?

Baijoo says: “In practice, what we have seen, is SARS increasing its collection drive on outstanding tax debts, in an effort to eradicate tax non-compliance. That being said, SARS remains open to discussions on payment arrangements and tax debt write-offs where taxpayers face financial hardship.”

He adds that figures in SARS’ latest Annual Report demonstrates the revenue collector’s willingness to permanently or temporarily write off taxpayer debt, with a staggering R36.15-billion written off in the 2023/24 financial year. 

Sesana says in the upcoming tax filing season, full compliance and tax debt collections will come into play for the individual taxpayer. “Taxpayers should not negate the fact that their tax debt may be a minimal amount. SARS will not let it go, because it has to end up in the state coffers. To collect R2.006 trillion in the 2025/26 fiscal year, every rand counts. Make sure your details at SARS is correct. If you have a debt, settle it. If you have a dispute, use the normal mechanism, but know that SARS will definitely come guns blazing this filing season.”

A welcome step by SARS, says industry

SAIT welcomes the fact that the Minister of Finance has extended the allocation to SARS to capacitate the tax authority because a well-functioning revenue service means a well-functioning democracy, and a well-functioning country. 

“We further welcome any such projects undertaken by SARS. For many years the SAIT has said that introducing new taxes is not the way to strengthen the state coffers. We must go after the money in the system, owed to the fiscus but not reaching SARS. Non-compliant taxpayers must be made to pay their fair share. Only thereafter can South Africa consider introducing new taxes,” Sesana said.

Submitted by Tax Consulting SA