SARS misses tax target by R13.1bn
Some estimates put gap for the year as high as R50bn
Tax revenue of R275.4bn in the first quarter of the financial year to end-June was R13.1bn lower than the printed estimate.
Tax revenue of R275.4bn in the first quarter of the financial year to end-June was R13.1bn less than the printed estimate, the South African Revenue Service (SARS) will report to Parliament on Wednesday.
This will confirm expectations that tax revenue for the year will fall far short of the target because of economic stagnation.
The Treasury’s revised projection for tax revenue for 201617 will be made known when Finance Minister Malusi Gigaba presents the medium-term budget policy statement in Parliament on October 25.
Treasury officials have confirmed that revenue collections are likely to fall short of budget targets. Some estimates put the shortfall as high as R50bn.
SARS executives will brief members of the parliamentary standing committee on finance on the tax authority’s firstquarter performance.
Personal income tax came in at R104.4bn for the quarter, against a target of R110bn. Corporate income tax was R54bn (R57bn target), dividend tax R7.2bn (R9.5bn), value-added tax (VAT) collections R63bn (R64.7bn) and customs duties R8.9bn (R9.7bn). Lower personal income tax was mainly because of pay-as-you-earn tax being lower by R4.7bn (-4.3%) and personal income tax assessment payments lower by R500m (-20,1%).
The shortfall in corporate income tax was because of provisional tax payments being lower by R2.4bn (-4.1%) than expected, as well as lowerthan-expected assessment payments by R400m (17.6%).
Customs duties were lower mainly because of shrinking contributions by clothing and footwear as well as cereals.
VAT on imports was lower than estimated by R1.6bn (-5.2%) mainly because of declining contributions by machinery, original equipment components and photographic instruments.
VAT refunds were lower than printed estimates by R700m (-1.5%) as real gross fixed capital formation recorded a slower growth of 1% quarter on quarter, from the 1.7% growth in the fourth quarter of 2016.
The temporary shutdowns by vehicle manufacturers for plant upgrades also had a direct effect on exports.
Specific excise duties were R900m (-9.2%) lower than the printed estimate mainly because of collections on cigarettes and tobacco being lower by R1.2bn (-30.2%). Taxes on properties were higher by R300m (R7.9%). Collections in June were driven by a one-off payment of R500m as a deposit relating to a deceased estate.