South African Revenue Service (Sars) commissioner Oupa Magashula on Friday quit with immediate effect after admitting that improper behaviour on his behalf constituted a failure to promote and maintain the high standard of professionalism and ethical behaviour that are expected of a Sars commissioner.

Deputy commissioner Ivan Pillay would head up Sars as acting commissioner until a replacement for Magashula, who had been head of the revenue service since 2009, has been found.

The resignation followed the outcome of an investigation initiated by Finance Minister Pravin Gordhan in March, to probe allegations of impropriety, which surfaced through the media.

The inquiry, undertaken by a committee headed by retired Constitutional Court Judge Zak Yacoob, found that Magashula had not committed a crime when he inappropriately offered a 28-year-old chartered accounted (CA) a job, but that he had placed the reputation and credibility of Sars at risk.

In 2010, Magashula was recorded offering the CA, over a phone call, a R700 000 job, while noting that, as a 28-year old, she should be earning over a million. He also offered that Sars would pay KPMG, her employer at the time, to let her go if she did not transfer within a month.

The call, which had been facilitated by a convicted drug dealer Timothy Marimuthu, sparked speculation that the recording was part of a blackmail scheme.

The allegations had called into question the integrity of staff recruitment processes at Sars and indiscretions by the commissioner, propelling Gordhan to determine whether the event had led to a breach of Sars processes or good governance practice, besides others.

"The South African Revenue Service is one of the key pillars of our fiscal order, and therefore, our democratic dispensation. It is an institution whose very foundations are built on the trust and credibility that South African taxpayers have in it. It is therefore critical that those to whom the stewardship of this vital fiscal institution is entrusted conduct themselves, during and after working hours, in a manner that ensures that they are above question," he said in a statement.

The committee also noted that during the investigation, Magashula was not as “frank” with the committee as would be expected of a person who “had the integrity” essential to the top position, and that he had interacted with Marimuthu more times than admitted.

The allegations of Marimuthu’s reported influence over Magashula, however, could not be determined as Marimuthu declined an interview request and the committee did not hold the powers to subpoena. Evidence was sourced through voluntary submissions by witnesses.

“The committee was unable to pronounce on the precise number of people who may have been involved in what the committee sees as the attempt to blackmail the Sars commissioner,” Gordhan said.

The Minister would now instruct Sars’ audit committee to determine whether the former commissioner’s behaviour breached any tax and customs processes.

Further, Gordhan planned to appoint a committee to review the revenue organisation’s governance and ethical standards, especially as they pertain to the office of the commissioner, and invited the public to submit recommendations on the codes.

“I would like to reassure South Africans that the Sars management team and employees are committed to the highest level of integrity, the best service to South Africans, and the fair implementation of tax and customs laws,” he affirmed.