South African Revenue Service (Sars) commissioner Edward Kieswetter says a major concern as he heads for the exit early next year is how vulnerable SARS still is to state capture.
“If you listen to what’s happening at the Madlanga commission and the [parliamentary] ad hoc committee, then we have to conclude that we’re not free of actors who seek to capture this space. Unfortunately, it appears that there is still a lot of enabling that takes place by those who have positions of responsibility, whether in political office or in government,” he says.
“It would be foolish to imagine that organs and institutions of state are completely rid of actors who try to have access, and that we are immune to being captured again.”
Sars was hollowed out during the years of state capture under president Jacob Zuma. Kieswetter, who with former commissioner Pravin Gordhan turned it into a world-class institution before Zuma appointee Tom Moyane set about destroying it, has spent the years since 2019 rebuilding it.
He says it’s critical that whoever succeeds him is a person of integrity who will be independent and not give in to any pressure, “wherever that pressure may come from”.
“Ultimately, it is the DNA, the integrity of all of our staff, that protects Sars. But it starts with the person at the top, who must be very clear that no instance of collusion or integrity breach will be tolerated.”
I’m saying to civil society, you have to be activist, you have to take agency. We have to jealously guard these institutions. It’s because we stand by and tolerate bad appointments that the erosion of key institutions takes place under our very eyes
— Edward Kieswetter, Sars commissioner
Since his appointment in 2019, more than 100 employees have been dismissed, more than 120 facing investigation have resigned, and more than 20 have been criminally charged and convicted.
As concerned as Kieswetter is about his own successor, he is keeping a worried eye on the selection of the new national director of public prosecutions because Sars has such a strong vested interest in who leads the National Prosecuting Authority.
Is he concerned that Menzi Simelane, whose appointment as NDPP was invalidated by the Constitutional Court in 2011 because he lacked the necessary integrity and competence, has made the short list?
“I would be concerned that anyone who has been found to be unfit for duty would even make a short list, or be considered as eligible,” says Kieswetter.
As for his own successor: “I am very clear, and I have indicated this to the finance minister and to the president, that all of the hard work we have done in the past seven years will be undone by appointing someone who is either not competent or who lacks the integrity that such an office demands. And I can say the same for the NPA. These are appointments that will make or break these institutions.”
Kieswetter says he would be “devastated” if appointments were made that reversed the progress at Sars or the NPA.
“South Africans should watch this process with great care, and should not sit back and allow such appointments to be made. Because even though the legal authority to make such an appointment sits with a minister or president, South Africans all have a stake in it.
“I’m saying to civil society, you have to be activist, you have to take agency. We have to jealously guard these institutions. It’s because we stand by and tolerate bad appointments that the erosion of key institutions takes place under our very eyes.”
Under his leadership, Sars has pursued multinationals that shift profits to tax havens, gold and tobacco mafias, and ultra-rich tax dodgers. “If you add up the combination of uncollected revenue plus the tax gap, our underrecovery is between R600bn and R800bn.”
Clawing it back requires far more investment in Sars, which has been Kieswetter’s consistent plea to finance minister Enoch Godongwana. The current allocation of R13bn-R14bn a year from the National Treasury is between R4bn and R5bn less than it should be, he says.
“If we really want to tackle the illicit economy and dismantle these criminal syndicates, we have to scale up the number of forensic investigators and excise officers to enforce our laws.”
Our plea is that the cases we hand over to the NPA are actually enrolled in the courts so they can be heard. We definitely are not on top of the inter-agency co-ordination we need
— Kieswetter
Otherwise, it’s a losing battle. “For example, we dismantle one big criminal tobacco syndicate, but there’s more than one, so we haven’t seen a decrease in the sale of illicit tobacco products.”
There’s a significant fightback from criminal syndicates, which requires the police, the Hawks and the NPA to work with Sars more effectively and in a more co-ordinated way, he says.
“One of the things that frustrates us is that what we prioritise does not necessarily end up as one of the priorities of the SAPS, Hawks or NPA.”
One case involving the tobacco mafia has been with the NPA for more than three years without going to court.
“Our plea is that the cases we hand over to the NPA are actually enrolled in the courts so they can be heard. We definitely are not on top of the inter-agency co-ordination we need.”
Parliament heard recently that Sars had flagged 105 tax noncompliance cases involving politically exposed people in the last three years, but Kieswetter bristles when asked about the tax compliance of former president Zuma.
He says he will not comply with information regulator Pansy Tlakula’s recent enforcement notice compelling Sars to release Zuma’s tax records. “For us, it’s never been about Zuma; it’s been about the principle. My main objective is to act without fear, favour or prejudice to apply the law.”
Doesn’t the information regulator make it clear that Zuma broke the law on numerous occasions?
That’s a matter for the NPA, not for Sars, he says. “Ask yourself one question: why would I be protecting Mr Zuma? After we know what he has done to our country, why would I be protecting him?”
Does he understand the frustration and anger of those who ask why he refuses to release tax records which, according to Tlakula, “may well” reveal evidence of Zuma’s noncompliance?
“Do you think I am not as angry as anyone else? When I listened to the Zondo commission, when I see police commissioners and senior civil servants and senior politicians who may have been compromised, I get angry. I get angry as a South African that our government is so porous and so easily corruptible.”
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