Jonas calls for border agency not to levy tax

Deputy Finance Minister Mcebisi Jonas has written to Parliament, insisting that customs and revenue collection remain under the auspices of the South African Revenue Service (SARS) when a border management agency is established.

The agency would fall under the Department of Home Affairs. The Treasury agrees on the need for a border agency, but differs on the functions it should take on. SARS collects up to 30% of all tax revenue from customs and excise.

The Davis tax committee has also advised against moving this function away from SARS, saying the tax authority’s systems are effective.

In the letter addressed to the portfolio committee on home affairs, Jonas expressed concern that the Department of Home Affairs’ proposed amendments to the Border Management Authority Bill were not in keeping with a consensus reached between the two departments that customs collection should remain with SARS.

“I strongly urge your committee to consider our proposal not to create uncertainty for SARS and the customs and revenue-collection function and to instead provide a mandatory coordination between the [bill] and SARS,” Jonas said.

Home Affairs Minister Malusi Gigaba said: “The [bill] won’t be a panacea, [but] will go a long way to resolve our problems.”