SARS suspends Makwakwa, starts to dig
THE South African Revenue Service (SARS) has initiated an investigation into allegations of misconduct against its second in charge, Jonas Makwakwa, over “suspicious and unusual” transactions totalling R1.2m.
Makwakwa, chief officer for business and individual taxes at SARS, received “unexplained” cash deposits and bank transfers amounting to R1.2m in 2010-2016. SARS commissioner Tom Moyane is said to have announced Makwakwa’s suspension to revenue service staff on Thursday.
Deposits of R450,200 were also made into the bank account of Makwakwa’s girlfriend, Kelly-Anne Elskie, in December 2015. She is a SARS employee. It is unclear whether any action has yet been taken against her.
The Treasury, under whose authority SARS falls, appeared surprised by disclosures that the second most senior official at the tax authority had been suspended. In a statement released on Thursday, the Treasury said it had noted media reports about Makwakwa’s suspension, but had not formally been notified of the move.
The latest controversy is yet another indication of the rift in relations between Moyane and Finance Minister Pravin Gordhan — a rift that President Jacob Zuma in February undertook to manage. The two fell out after Moyane refused to halt a restructuring process at SARS after Gordhan instructed him to do so. Moyane also lodged a complaint with the Hawks around the alleged “rogue unit” at SARS during Gordhan’s tenure as commissioner.
Moyane received a report from a banking regulator in May, detailing the allegations against Makwakwa, but has now acted against him following disclosures about the transactions in the Sunday Times.
The internal notice issued by Moyane says he had “taken all reasonable steps within [SARS] policies to engage with the matter.
“This included providing both officials with the opportunity to respond to the allegations.”
He went on to say: “I believe that SARS has followed the correct procedure in terms of our policies when it comes to such serious allegations of misconduct.”
SARS has in the past been dragged to the Labour Court — and lost — over its handling of the suspension of former deputy commissioner Ivan Pillay. In that judgment, the Labour Court found that Pillay was not provided with a written notice of SARS’s intention to suspend him and it was in breach of his employment contract.
On Thursday, Makwakwa could not be reached for comment on Moyane’s announcement that he had he issued Makwakwa with a suspension letter, pending a full
I believe SARS has followed the correct procedure … when it comes to such serious allegations
investigation. SARS has had a string of investigations into senior officials in recent years.
Former commissioner Oupa Magashula resigned in July 2013 after an internal probe into allegations of impropriety were levelled against him.
In the Magashula case, Gordhan appointed retired Constitutional Court Justice Zak Yacoob to lead the inquiry into claims that he had offered a woman a job at SARS without following procedure.
In 2014, SARS instituted an investigation into its head of enforcement and investigations, Johann van Loggerenberg, after a complaint was laid with the tax agency by tobacco attorney and state security agent Belinda Walter — according to the report on the investigation. That investigation, headed by advocate Muzi Sikhakhane, took 45 days.
At the time, SARS had requested the Treasury to appoint a retired judge to conduct the probe, but after receiving no response after three weeks, it opted to appoint an advocate instead — which it had the power to do.