SARS’ record-breaking revenue shortfall due to ANC mismanagement

1 April 2019

The Democratic Alliance (DA) notes with great concern the under-collection of R57.4 billion in revenue for the 2018/19 financial year. Finance Minister, Tito Mboweni, must give a clear plan of action to address the chronic revenue under-collection of the last couple of years.

The revenue under-collection is partly due to the inefficiencies that swept into SARS under the Moyane regime and which have started to be reversed by the acting SARS Commissioner, Mark Kingon, and his team. However, the real and substantive reasons for revenue shortfalls emanate from a struggling South African economy that is hamstrung by the ANC’s mismanagement, and continuing ANC corruption.

On the 28th of March 2019, the South African Reserve Bank (SARB) revised their 2019 growth rates for the South African economy down from 1.7% to 1.3%, a massive 23.5% reduction in growth. This implies a reduction in growth of approximately R21 billion. Even this reduced growth forecast is very optimistic given the very real probability of ongoing and extensive Eskom electricity rolling blackouts that are likely to continue immediately after the elections on the 8th of May 2019. Which makes the likelihood of yet another revenue shortfall very likely for 2019.

Minister Mboweni must inform South Africans what robust action he has taken and intends to take in order to prevent more under collection, and how expenditure will be curbed to adjust to lower revenue levels.

The DA has therefore written to Minister Mboweni to request that he urgently take South Africans into his confidence and to inform them whether there are urgent action steps taken to address the chronic revenue under-collection to ensure that there isn’t a shortfall in 2019.

Issued by Alf Lees, DA Shadow Minister of Finance, 1 April 2019