South Africa closer to introducing Tax Ombud

The Tax Administration Act, which gives the South African Revenue Service (SARS) wide ranging powers and will include the introduction of a Tax Ombud, has been promulgated this week. The Act was introduced a year ago and Finance Minister Pravin Gordhan made a commitment to introducing the Tax Ombud this year in his 2012 Budget Speech. 


The Democratic Alliance (DA) said it welcomed the promulgation of the Act adding that it will monitor the situation to ensure that the Ombud acts independently of SARS. “If there are signs that this is not happening we will table amendments to increase their independence by cutting funding and operational ties with SARS,” said Tim Harris, DA Shadow Minister of Finance.


The DA said it didn’t have figures as to the number of complaints about unfair treatment laid against SARS but Harris said he received a number of complaints about SARS a month. “There needs to be a formal channel that can give people recourse. Currently the only recourse people have is to complain to SARS or to the Treasury,” added Harris.


Concerns about SARS’ powers, which include searching and entering a taxpayer’s home without a warrant if it suspects fraudulent activity, were also raised by the DA. Harris said the party was in support of the bill but warned that it would not allow SARS to misuse its new powers.


“We note public concerns around the relevant safeguards protecting against the new "search without warrant" clause. During the Parliamentary process several amendments were made to the bill to protect legal privilege during seizure and to ensure that damages arising from search and seizure can be claimed. In addition, a provision was inserted to ensure that a Tax Ombud's Report must be tabled in Parliament. The DA will undertake a watching brief to look out for any patterns of abuse,” he said.