What SARS does
The South African Revenue Service was established by legislation to collect revenue and ensure compliance with tax law. Its vision is to be an innovative revenue and customs agency that enhances economic growth and social development, and supports South Africa’s integration into the global economy in a way that benefits all citizens.
In accordance with the South African Revenue Service Act 34 of 1997, the service is an administratively autonomous organ of the state: it is outside the public service, but within the public administration. So although South Africa’s tax regime is set by the National Treasury, it is managed by SARS.
SARS aims to provide an enhanced, transparent and client-orientated service to ensure optimum and equitable collection of revenue.
Its main functions are to:
collect and administer all national taxes, duties and levies;
collect revenue that may be imposed under any other legislation, as agreed on between SARS and an organ of state or institution entitled to the revenue;
provide protection against the illegal importation and exportation of goods;
facilitate trade; and
advise the Minister of Finance on all revenue matters.
For more information, see our latest SARS Strategic Plan 2010/11 – 2012/13 NEW!
Facilitate Trade (Customs)
As part of its mandate to support the economy and provide the revenue needed by the government to build democracy, SARS performs several important roles in international and local trade.
In fact, one of SARS’s core functions is the provision of a customs service that maximises revenue collection, protects South Africa’s borders and facilitates trade. It does this by:
enforcing customs and related trade laws;
collecting duties and taxes;
ensuring the social welfare of citizens by controlling the import and export of prohibited and restricted goods; and
ensuring timeous clearance of goods and facilitating the speedy movement of travellers through South African borders.
SARS is led by its Commissioner, but Customs is managed by a general manager who reports directly to the Commissioner.
Customs administers external-trade regulations. This does not just involve duties and trade regulation – it also entails enforcing environmental, anti-dumping, consumer-protection, health and agricultural controls.
The Customs division works to facilitate trade and make it possible for companies and individuals to trade in an efficient and legal way. Unfortunately, there is a portion of trading activity that is illegal. The laws of the country and international obligations require Customs authorities to police trade.
There are Customs branch offices at all major entry and exit points.
How SARS facilitates trade
SARS, through its Customs division, makes it possible for businesses and individuals to engage in cross-border economic activity in a legitimate and efficient manner. SARS has put measures in place to reduce the inconvenience importers and exporters face in meeting revenue obligations. Sophisticated profiling, for example, ensures that high-risk cargo is prioritised.
Legislation also plays an essential role here, helping to make sense of the broad range of controls that have to be implemented as international co-operation increases. Laws, for example, enable control to be exercised while reducing friction with the regional and international trading system.
The negotiation of customs and tax agreements is carried out by the Law Administration division. These agreements, which are aimed at enabling the international trade regime, are administered by SARS. They also play a significant role in creating the right business environment for companies and individuals.
Customs also negotiates and maintains free-trade agreements, such as with the South African Customs Union, the European Union and the Southern African Development Community. It has General Systems of Preference agreements, such as the African Growth and Opportunities Act or AGOA, which afford local manufacturers greater competitiveness in foreign markets.
The government seeks to boost competitiveness in the local export manufacturing sector and has designated four Industrial Development Zones (IDZs) to support this commitment. SARS will play a key role in the administration of enterprises operating in the designated customs-controlled areas of these IDZs.
Customs is also engaged in developments that have the explicit intention of protecting and promoting the interests of the country, Africa and the developing world. Working with other African customs administrations, SARS has made a significant contribution to the New Partnership for Africa’s Development.