Promulgation of Tax Administration ACT, 2011
5 Jul 2012The Tax Administration Bill was promulgated into law yesterday (Act 28 of 2011) in Government Gazette 35491 of 4 July 2012. In terms of section 272 of the Act, the Act will come into operation on a date to be determined by the President by proclamation in the Gazette. SARS’s preparations for the implementation of the Act are at an advanced stage and it anticipated that it will come into operation within the next three months.
The Act is intended to simplify and provide greater coherence in South African tax administration law. It eliminates duplication, removes redundant requirements and aligns disparate requirements that currently exist in different tax Acts ranging in age from 4 to 63 years old. It creates a single, modern framework for the common administrative provisions of the tax Acts.
Most taxpayers are compliant and the Act should ensure better service and a lower compliance cost for them. SARS is, however, duty bound to actively pursue tax evaders in order to maintain compliant taxpayers’ confidence in the integrity of the tax system.
Some key features of the Act are:
Although the Act provides for a year from its commencement for the appointment of the Tax Ombud, the Minister of Finance announced in his 2012 Budget Speech that the Tax Ombud will be appointed this year.
- A phased move to a single registration process and number across taxes, to reduce red tape and streamline the system, and self-assessment of taxes, so taxpayers need not wait for a SARS assessment;
- Greater access to third party data, to underpin SARS initiatives such as the pre-population of individual tax returns;
- Clearer rules on SARS access to information, so tax liabilities can be determined more quickly and accurately;
- The ability to search business premises without a warrant in narrowly defined situations where the general requirement for a warrant would defeat the object of the search, so SARS can act when tax is at serious risk and time is of the essence;
- Clear requirements and timelines for the issue of tax clearance certificates, to provide greater certainty and responsiveness to business;
- Feedback on audit progress and findings, to engage more fully with taxpayers and ensure they understand the reasons for any adjustments;
- Specific timeframes for decisions of the Tax Board (a “small claims court” for tax) and wider reporting of Tax Court decisions, to improve access to justice; and
- The appointment of a Tax Ombud, informed by international experience, to provide taxpayers with a low cost mechanism to address administrative issues that could not be resolved through SARS’s normal channels.
The Act benefitted from two rounds of public consultation in 2009 and 2010, while in draft form, as well as the thorough Parliamentary process that followed its introduction by the Minister of Finance on 23 June 2011.
SARS wishes to thank all those involved in these processes.
Please note: Submissions by SARS to Parliament on two aspects of the legislation accompany this media statement.
- Response SC0F TAB Briefing Note Search Without Warrant
- Response SC0F TAB Briefing Note Tax Ombud
Issued by: South African Revenue Service
5 Jul 2012
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