Nearly R450-million in tax refunds has been paid out to the ten taxpayers with the largest disputes with revenue authorities in the 2017/18 financial year, as a result of the intervention of the Office of the Tax Ombud (OTO).
The OTO reported these figures during the launch, on Tuesday, of its annual report for 2017/18, which coincided with the fifth anniversary of the establishment of the OTO.
The OTO is an independent and impartial State institution that provides a simple, free and impartial channel for the resolution of a service, procedural or administrative dispute that taxpayers might have already unsuccessfully tried to resolve through the South African Revenue Services (Sars) internal complaints resolution channels.
The OTO seeks to ensure a balance between Sars and taxpayer’s rights and obligations.
Judge Bernard Ngoepe told delegates that the top ten complaints, with the highest amounts, resulted in R446-million in value-added tax (VAT) and corporate income tax (CIT) refunds paid out to taxpayers after complaints were lodged with the OTO against Sars.
The highest refund paid was a VAT refund, which amounted to R158.29-million. This was followed by a refund of R90.97-million.
Ngoepe further noted that the organisation has experienced a significant increase in the number of contacts, from 670 in the 2013/14 financial year, to over 17 000 in the 2017/18 financial year.
“We are pleased with how we have been able to help promote fairness in the country’s tax administration system and we look forward to working with other stakeholders, not just to promote and protect the rights of taxpayers but also to promote tax compliance,” he said.
The office, Ngoepe added, has helped resolve thousands of taxpayers’ complaints against the revenue collector in the past five years but he pointed out that there is still much that needs to be done.
“We have already brought about positive changes in the Tax Administration Act, which have given us powers to investigate systemic issues and more independence from Sars, among others.”
Ngoepe and OTO CEO Advocate Hanyana Mkhawane both, meanwhile, noted that they would like to see a Tax Bill of Rights introduced.
This, Mkhawane said, would, besides others, mean structural independence while educating taxpayers on what their rights are, as well as what to expect and what lies ahead, when complaints are filed.
Additionally, the OTO is also working closely with government through the National Treasury’s Technical Advisory Centre (GTAC), which is assisting in developing a business case for a cost-effective and independent organisational model.
Moving forward, the biggest priority for the OTO, Ngoepe pointed out, was to achieve total independence from Sars, especially in terms of finances.
In this respect, he noted that there was a process which had been initiated and discussed with the National Treasury about the future corporate status of the OTO.
“We have had consultations with the Treasury’s consulting service, GTAC, about what format this office should adopt. One of the biggest priorities is for the OTO to acquire an appropriate status as a body,” Ngoepe elaborated.
He has written to the Finance Minister about this for some engagement.
Apart from the issue of independence, the OTO is also aiming to increase its provincial footprints. The OTO currently has only one office, located in Pretoria, for the entire country.
“We need to be accessible and that means going out to various provinces so that people can reach us. We hope to achieve this in due course,” he noted.