In the recent SARS tender, RFP 15/2024, for Tax Consulting Services, it has become clear that even the biggest players in the game want a piece of the pie!

The tender briefing in early September saw attendance from both Big 4 Audit firms and Big 5 Law firms, but not all of whom made it onto the final bidder list, published by SARS on 01 October 2024.

From over 150 attendees in the briefing session, the final list reveals only 58 bidders, from which the most noteworthy is Deloitte & Touche, one of the largest audit firms globally.

Privatisation of Specialised SARS Functions to Streamline Tax Processes

In furtherance of its strategic objectives, SARS is looking to outsource more specialised roles, and on an “as and when” basis. This includes international tax, with a focus on profit shifting and transfer pricing, on the corporate side.

Looking at individual taxpayers, the tender seeks specialists to conduct in-depth, and often forensic audits, of complex financial transactions and wealthy taxpayers, which the Big Audit and Law firms are well known for, just from the other side.

The specific strategic objectives focused on are “making non-compliance hard and costly”, whilst streamlining processes and increasing efficiency, will allow for “making voluntary compliance easy”.

Bearing credence to SARS’ commitment to smooth operations, is the speed in which the bidder list was published for RFP 15/2024, being the very next day after tender submissions closed.

Compliance Checkmate

Commissioner Kieswetter, being a strategic mover, may have a larger strategy in play, but for now, there are mostly 2 trains of thought here:

1.      SARS acknowledge their internal shortage of skilled senior officials and aim to remedy this through the private sector and increase capacity to crack down on taxpayers. This will gear predominantly toward increased revenue collection for SARS.

2.      From a most taxpayer-centric ethos, the other speculation is that SARS are building systems and capacity to create a more user-friendly and seamless taxpayer experience, to promote voluntary tax compliance. This is more of a “first time correct” model and will bolster taxpayer trust and confidence in the revenue collector.

Being a pilot project, it is not entirely clear what the end-result will be, and if privatisation of tax collections will yield just better revenue collections, or if also to the benefit of the South African taxpayers experience. 

Written by Jashwin Baijoo, Associate Director and Head of Strategic Engagement & Compliance at Tax Consulting SA