Ramaphosa shows his hand in Moyane case
SUSPENDED SA Revenue Service (Sars) commissioner Tom Moyane is a serial lawbreaker, his conduct unlawful and his continued presence at the helm of the nation’s tax authority threatens tax morality and could damage the key institution’s credibility.
This is according to an explosive affidavit by Public Enterprises Minister Pravin Gordhan, which has revealed President Cyril Ramaphosa’s case against Moyane.
The affidavit was filed on Wednesday, after Ramaphosa missed last Friday’s deadline to reveal details of the case against Moyane before his disciplinary inquiry, chaired by senior counsel Azhar Bham. Ramaphosa suspended Moyane in March, after informing him that he had lost confidence in his ability to lead Sars, and offered him an opportunity to resign with immediate effect.
Moyane, who declined Ramaphosa’s offer, was replaced by the group executive responsible for relationship management within business and individual taxes, Mark Kingon, as acting commissioner.
Last month, Ramaphosa established a commission of inquiry headed by retired Supreme Court of Appeal Judge Robert Nugent to focus on tax administrative issues, like VAT refunds and shortfalls in revenue in the past two financial years.
Gordhan’s affidavit shows Moyane faces four charges, including failure to act against his former second-in-command, Jonas Makwakwa, Sars’ chief officer for business and individual tax, and junior consultant Kelly Ann Elskie, after a confidential Financial Intelligence Centre (FIC) report into suspicious and unusual cash deposits into their bank accounts.
According to his 69-page affidavit, Gordhan, who was finance minister until March 2017 and responsible for Sars, Moyane failed to timeously ensure that Sars immediately conducted investigations to report Makwakwa and Elskie to the police and the Hawks.
“The allegations made in the FIC report were extremely serious with the potential, if not handled correctly, to damage the credibility of Sars, tax morality and the collection of tax revenue,” Gordhan said.
The affidavit also states that Moyane acted unlawfully by disclosing the contents of the report to Makwakwa and Elskie without obtaining permission from former FIC director Murray Michell, as this was prohibited by the FIC Act. Other charges include Moyane’s unilateral decision to increase salaries and implement bonus payments to senior executives without Gordhan’s approval.
Gordhan reported the matter to Auditor-General Kimi Makwetu, arguing they were in contravention of the Sars Act.
Makwetu found that senior managers’ salary increases and bonus payments were not in contravention of the Sars Act, but could result in irregular expenditure.
Sars claimed Makwetu’s findings were a fundamental error of law, and threatened legal action, ignoring two legal opinions obtained by the taxman.
Moyane is accused of violating Sars’ code of conduct by committing gross misconduct.
Moyane claimed he played no role in appointing eight debt collectors for 18 months in a deal worth more than R341 million.
One of the companies that got a share of the debt collection contract was New Integrated Credit Solutions, which is owned by Moyane’s friend, Patrick Monyeki.
Gordhan said Moyane concealed his role in approving the appointment of his friend’s company.
Moyane has two weeks to respond to Gordhan’s affidavit.