SARS Employs Private Specialists to Bolster Tax Compliance and Enforcement

The South African Revenue Service (SARS) is intensifying its tax compliance and enforcement strategy by establishing an external panel of specialist tax consulting firms. Slated for a five-year term as per an announcement on August 26, 2024, this collaboration signifies a significant shift in SARS’s approach to combating tax evasion and navigating the intricacies of tax law.

Mr. Jashwin Baijoo from Tax Consulting SA shared insights into this new tender, highlighting the potential for immediate access to the nation's leading private tax minds. The panel—which remains open in size but can feature up to 88 specialists from each firm—aims to address SARS's need for adept resources and proficiency in tackling complex tax avoidance schemes.

By onboarding tax experts from various technical and compliance backgrounds to manage audits, raise assessments, and even collect due taxes, SARS is preparing to take on sophisticated cases that include forensic audits and corporate restructures. This synergy between private practice and the revenue service fulfills a dual role: enhancing SARS's capabilities and allowing tax practitioners who have been critical of past efforts to directly contribute to the resolution process.

This partnership is not without precedent; the US Treasury also incorporates private sector experience for its senior tax collection officials. Recognizing the effectiveness of this practice, SARS amplifies its zero-tolerance stance on non-compliance with the backing of specialized consultants. Taxpayers are cautioned to ensure their compliance, with voluntary disclosure programs highlighted as a prudent step for those seeking to avoid the full weight of enforcement actions.

The implications of this procurement extend beyond the tax authorities. The private sector's prominent role in tax administration represents a pivotal development in tax law enforcement. As SARS equips itself for a more aggressive stance against tax evasion, the message to taxpayers is clear: compliance standards must be met, or the risk of detection and litigation looms larger than ever before.