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<p>The illict tabacco industry has come under fire with SARS investigating illegal traders. With promises from SARS of a crackdown, how much has been done? Joining CNBC Africa for more is Francois van der Merwe, Chair of the Tobacco Institute for Southern Africa.</p>


How Tom Moyane caused illicit cigarette trade in SA to blow up

<p>By Monique Vanek</p>
<p>The Medium Term Budget Policy Statement (MTBPS) has confirmed that the South African Revenue Service (SARS) under its former Commissioner Tom Moyane delayed paying tax refunds, which is now hurting revenue.</p>
<p>According to its current Commissioner Mark Kingon, whether this was intentional or not is up for debate but he believes it was not intentional.</p>
<p>Kingon in a closed media briefing said SARS is currently evaluating why refund payments slowed.</p>
<p>The MTBPS points a negative picture of what happened to tax revenues under Moyane’s tenure and the aftermath: “A backlog of VAT refunds at SARS, and an underestimation of refunds due, has led to an overly optimistic view of revenue growth. Net VAT collections account for about R20 billion of the in-year revenue shortfall. Two factors account for the revision in net VAT. The VAT refund estimate has been revised upwards by R9 billion, and about R11 billion will be paid out to clear the backlog in the VAT credit book (see table).</p>
<p>“The remaining R7.4 billion of the shortfall in the current year mostly reflects slower corporate income tax collections due to weak growth in wholesale and retail trade, manufacturing and transport. Personal income tax continues to be negatively affected by job losses, moderate wage settlements, lower bonus payments and a slower expansion of publicsector employment”.</p>
<p>The MTBPS also states: “In 2017/18, for the first time since the 2008 global financial crisis, tax revenue growth did not exceed GDP growth. Revenue shortfalls have widened over the past four years, with under-collections rising from R7.4 billion in 2014/15 to R49 billion in 2017/18. These shortfalls would have been larger were it not for increases in personal income, dividend withholding, capital gains and other taxes. Revenue collections in 2017/18 were R0.8 billion lower than estimated in the 2018 Budget. Revenue collection for the first six months of 2018/19 grew by 10.7 per cent compared with the same period last year. However, the technical recession experienced in the first half of the year has begun to feed through to revenue collection, which has slowed. Weaker economic growth, alongside a once-off payment of overdue VAT refunds, will result in an in-year revenue shortfall now estimated at R27.4 billion, relative to the 2018 Budget estimate.”</p>


#MTBPS2018: SARS withheld tax refunds under former Commissioner Moyane, these are the consequences…

<p>JOHANNESBURG (Reuters) &#8211; An inquiry reviewing evidence on Tom Moyane, the suspended head of South Africa’s Revenue Service (SARS), issued an interim report on Tuesday urging President Cyril Ramaphosa to fire the tax official.</p>
<p>The agency has been plagued by infighting over the last three years and is subject to ongoing government investigations.</p>
<p>Judge Robert Nugent, who is heading the inquiry into Moyane, says the suspended tax chief should be removed from office for the “reckless mismanagement of SARS” under his tenure.</p>
<p>“We consider it imperative that a new commissioner be appointed without delay to remove the uncertainty at SARS and enable it to be set on a firm course of recovery so as to arrest ongoing loss of revenue,” Nugent said in the report.</p>
<p>In March, Ramaphosa suspended Moyane, saying he had failed as commissioner of the revenue service and had lost the confidence of taxpayers.</p>
<p>Moyane was not available for comment on Tuesday. He has repeatedly defended his record and denied any wrongdoing.</p>
<p>The president’s office said Ramaphosa was weighing up the contents of the interim report and its recommendations.</p>
<p>As part of that process, Ramaphosa had given a copy of the interim report to Moyane, and invited him to make any submissions on its recommendations.</p>
<p>Moyane, who was appointed in 2014, had been criticised by SARS employees and members of the ruling African National Congress after the tax agency missed revenue collection targets and faced allegations of corruption and mismanagement.</p>
<p>Reporting by James Macharia; Editing by Gareth Jones</p>


South Africa’s Ramaphosa urged to fire suspended tax head, what you need to know…

<p>Bain &amp; Company, which has been in the firing line for its work done at the South African Revenue Service (SARS) has set aside R164 million ($10.8 million) of fees plus VAT and interest paid to it by SARS. In a statement it said “the money will be used either as prescribed by the Nugent Commission of Inquiry or – in the absence of such prescription &#8211; for the benefit of South Africa”.</p>
<p>In 2014, Bain conducted a diagnostic for SARS after being employed by the collection service’s then boss Tom Moyane. The plan has been widely criticised for weakening SARS’S collection abilities.</p>
		
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<p>In a statement, the consultancy service said its organisation structure work at SARS did not achieve positive results for its client.</p>
<p>Bain also revealed that Vittorio Massone will step down as managing partner, and be replaced by Tiaan Moolman, a long serving member of the company.</p>
<p>Massone however remains a partner at Bain &amp; Company and will focus his time on cooperating with the Nugent Commission, the statement said.</p>
<p>Elaborating it said: &#8220;We have requested Tiaan Moolman to take over day to day operations as interim managing partner. It has been known to our clients for some time that Mr Massone would rotate out of his current role in December to take on another senior role within the firm. This rotation typically occurs each 5-7 years and Mr Massone has already completed almost 9 years in his current role&#8221;.</p>
<p>Much of the destruction caused by Bain came to light at the Nugent Inquiry into SARS where Massone testified (see video). Following his and others’ testimony Bain &amp; Company launched an independent investigation led by global law firm Baker McKenzie to examine the facts relating to people, processes, and governance that resulted in it getting and accepting the work.</p>
		
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<p>In a statement Bain says initial findings have shown that its engagement with SARS fell short of its operating principles.</p>
<p>The consultancy also said to reinforce the independence of the investigation and Bain’s commitment to addressing any new facts, it has established an oversight committee made up of senior global Bain partners. “Athol Williams, a Bain alumnus and a respected independent advisor, will chair this committee on an interim basis. He is a distinguished academic in the areas of corporate responsibility, a corporate leader, and lifelong social advocate.”</p>
		
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Bain & Company plans to pay back $10.8 million for SARS work, Managing Partner changes role

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<p>Vittorio Massone, managing partner of Bain &#038; Company dropped a bombshell at the Nugent Commission when he told them that Bain met Tom Moyane to discuss the South African Revenue Service even before Moyane was appointed to head up the tax collection service.</p>


Tom Moyane met with Bain over SARS even before his appointment

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<p>Vittorio Massone, managing partner of Bain &#038; Company&#8217;s Johannesburg office overseeing sub-Saharan Africa told the Nugent Commission why the restructuring it orchestrated at South African Revenue Service failed.</p>


Why Bain’s SARS restructuring plan went wrong

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<p>Judge Dennis Davis, the chair of the Davis Tax Committee discusses the role of Bain &#038; Co’s involvement with disastrous restructuring at SARS.</p>


Judge Dennis Davis on former SARS boss Tom Moyane, Bain & Co

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<p>Suspended SARS Commissioner, Tom Moyane’s disciplinary hearing kicked off in Sandton on Saturday with a number of objections coming from Moyane. Advocate Dali Mpofu, who appeared on behalf of Moyane, submitted objections on fairness, the terms of reference and the admissibility of Public Enterprises Minister Pravin Gordhan. Mpofu also hit out hard at President Cyril Ramaphosa‚ saying that the president was not being fair to the suspended tax boss.</p>


Suspended SARS commissioner faces disciplinary hearing

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<p>The editor of Huffington Post, Ferail Haffajee, spoke to CNBC Africa on how the media could have got it all wrong with really transpired at SARS.</p>


Did the SA media get it all wrong on SARS?

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<p>The good news is tax to be spent on South African citizens is up, the bad news is, it’s not as much as it should be.</p>


Sars seeks to improve revenue collection, restore credibility

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<p>Mark Kingon, Acting Commissioner for the South African Revenue Service details revenue collection for the 2017/2018 period to CNBC Africa’s Aviwe Mtila.</p>


Sars misses target of R1.27 trillion for 2017/2018

<p>Mark Kingon was appointed acting head of South Africa’s tax office on Tuesday, hours after President Cyril Ramaphosa suspended his predecessor and days before a Moody’s review that could see the country lose its last investment-grade credit rating.</p>
<p><img loading="lazy" decoding="async" class="aligncenter wp-image-302358 size-full" src="http://cnbc.africa/wp-content/uploads/2018/03/Tom-Moyane_SARS_GettyImages.png" alt="" width="850" height="579" /></p>
<p class="">The move was seen as a signal of intent to ratings agencies and investors that had lost faith in Africa’s most developed economy under former leader Jacob Zuma. It follows a cabinet reshuffle which sacked or demoted several allies of Zuma, who was forced to step down by the ruling ANC last month.</p>
<p class="">Ramaphosa suspended Zuma-appointed Tom Moyane late on Tuesday, saying he had failed as head of the South African Revenue Service (SARS) and had lost the confidence of taxpayers.</p>
<p class="">Kingon, SARS chief officer for business and individual taxes, was announced as acting commissioner on Tuesday.</p>
<p class="">Mindful that investors who finance its big budget and current account deficits have lost confidence in South Africa, Ramaphosa has begun to reform the economy and state-owned companies like power utility Eskom and South African Airways.</p>
<p class="">A test of whether his early changes have helped shift sentiment will come on Friday when credit rating agency Moody’s completes a review that could see it downgrade South Africa’s local and foreign debt to “junk” status.</p>
<p class="">“This (Moyane’s suspension) is a clear sign to Moody’s that strong steps are being taken to turn financial institutions around,” said Joon Chong, partner in Webber Wentzel’s Tax Practice. “We may avoid a downgrade by the skin of our teeth.”</p>
<p class="">Rating agencies Fitch and S&amp;P both demoted South Africa from investment-grade last year as economic growth slowed and public finances deteriorated.</p>
<p class="">Moyane, who was appointed in 2014, had been criticised by SARS employees and members of the ruling African National Congress after the tax agency missed revenue collection targets and faced allegations of corruption and mismanagement.</p>
<p class="">In last month’s budget the Treasury said it faced a 48.2 billion rand ($4 billion) revenue gap in the current 2017/18 fiscal year, partly due to SARS missing its collection target.</p>
<p class="">Moyane was not available for comment on Tuesday. He has repeatedly defended his record and had the support of Zuma.</p>
<p class="">But Ramaphosa said he had lost faith in his leadership.</p>
<p class="">“The disrepute in which you have brought the SARS and the government as a whole and the risk to the national Revenue Fund are enormous,” Ramaphosa said in a March 19 letter informing Moyane of his suspension that was seen by Reuters.</p>
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<p class="content_27_rw">Reporting by Joe Brock and Olivia Kumwenda-Mtambo; Editing by Catherine Evans</p>
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Zuma’s tax chief ousted ahead of South Africa ratings decision

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<p>This morning the business community was waking up to the Presidency’s decisions to suspend the  controversial head of the South African Revenue Services Tom Moyane has been suspended ahead of a disciplinary hearing.</p>


Outa welcomes SARS boss Tom Moyane’s suspension

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<p>Sandile Mamela, Spokesperson at SARS joins CNBC Africa to discuss the Presidency’s decisions to suspend the controversial head of the South African Revenue Services Tom Moyane.</p>


SARS reacts to Tom Moyane’s suspension

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<p>Joon Chong, Partner at Webber Wentzel’s Tax Practice joins CNBC Africa to discuss the Presidency’s decisions to suspend the controversial head of the South African Revenue Services, Tom Moyane.</p>


Will Tom Moyane’s suspension avert SA downgrade from Moody’s?

<p>Statement by SA&#8217;s National Treasury and Presidency</p>
<p>Mark Kingon has been appointed as Acting Commissioner for the South African Revenue Service (SARS) following the suspension of Tom Moyane, the Commissioner of SARS by the President.</p>
<p>President Cyril Ramaphosa on Monday, 19 March 2018 informed Moyane of his suspension with immediate effect pending the institution of disciplinary proceedings.</p>
<p>President Ramaphosa said it was in the public interest to restore the credibility of SARS without delay.</p>
<p>In a letter to Moyane, President Ramaphosa said :Developments at the SARS under your leadership have resulted in a deterioration in public confidence in the institution and in public finances being compromised. For the sake of the country and the economy, this situation cannot be allowed to continue, or to worsen.&#8221;</p>
<p>Concern was raised in particular about the manner in which Moyane handled the matter of Makwakwa, his treatment of the report given to him by the Financial Intelligence Centre, and his failure to immediately report this to the Minister of Finance.</p>
<p>Another concern that was raised was the management of VAT refunds, which had brought the SARS into serious disrepute and potentially jeopardised the integrity of the SARS as collector of revenue and adversely affected tax morality among tax payers.</p>
<p>The decision to suspend Moyane follows a meeting in which President Ramaphosa informed Moyane that he had lost confidence in his ability to lead SARS and offered him an opportunity to resign with immediate effect, which Moyane declined.</p>
<p>President Ramaphosa indicated that as SARS Commissioner, Moyane holds a high position of trust in the management of the country&#8217;s public finances. It was therefore necessary to act urgently and immediately to protect the institution and place it on a path to stability and recovery.</p>
<p>Kingon is currently the Acting Chief Officer: Business and Individual Taxes, within SARS. He has been with SARS since its establishment and worked his way through the ranks to become the Group Executive: Relationship Management within Business and Individual Taxes.</p>
<p>&nbsp;</p>


South African Revenue Service appoints acting head as Moyane suspended

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<p>South African Revenue Service&#8217;s Commissioner Tom Moyane plans to take legal action against KPMG. This comes after the audit firm revealed plans to retract parts of its report on the tax authority&#8217;s &#8220;rogue unit&#8221;.</p>


Tom Moyane

How Tom Moyane caused illicit cigarette trade in SA to blow up

#MTBPS2018: SARS withheld tax refunds under former Commissioner Moyane, these are the consequences…

South Africa’s Ramaphosa urged to fire suspended tax head, what you need to know…

Bain & Company plans to pay back $10.8 million for SARS work, Managing Partner changes role

Tom Moyane met with Bain over SARS even before his appointment

Why Bain’s SARS restructuring plan went wrong

Judge Dennis Davis on former SARS boss Tom Moyane, Bain & Co

Suspended SARS commissioner faces disciplinary hearing

Did the SA media get it all wrong on SARS?

Sars seeks to improve revenue collection, restore credibility

Sars misses target of R1.27 trillion for 2017/2018

Zuma’s tax chief ousted ahead of South Africa ratings decision

Outa welcomes SARS boss Tom Moyane’s suspension

SARS reacts to Tom Moyane’s suspension

Will Tom Moyane’s suspension avert SA downgrade from Moody’s?

South African Revenue Service appoints acting head as Moyane suspended

SARS to take legal action against KPMG

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Tom Moyane

How Tom Moyane caused illicit cigarette trade in SA to blow up

#MTBPS2018: SARS withheld tax refunds under former Commissioner Moyane, these are the consequences…

South Africa’s Ramaphosa urged to fire suspended tax head, what you need to know…

Bain & Company plans to pay back $10.8 million for SARS work, Managing Partner changes role

Tom Moyane met with Bain over SARS even before his appointment

Why Bain’s SARS restructuring plan went wrong

Judge Dennis Davis on former SARS boss Tom Moyane, Bain & Co

Suspended SARS commissioner faces disciplinary hearing

Did the SA media get it all wrong on SARS?

Sars seeks to improve revenue collection, restore credibility

Sars misses target of R1.27 trillion for 2017/2018

Zuma’s tax chief ousted ahead of South Africa ratings decision

Outa welcomes SARS boss Tom Moyane’s suspension

SARS reacts to Tom Moyane’s suspension

Will Tom Moyane’s suspension avert SA downgrade from Moody’s?

South African Revenue Service appoints acting head as Moyane suspended

SARS to take legal action against KPMG

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