SARS was formed out of the amalgamation of the segregated revenue services of the apartheid-based Bantustans, as well as the Departments of Inland Revenue and Customs respectively. By law, SARS is an administratively autonomous organ of state within the public administration, and an institution outside the public service. The SARS Act mandates the organisation to:
- Collect all revenue due.
- Ensure optimal compliance with tax, Customs and excise legislation.
- Provide a customs and excise service that will facilitate legitimate trade, as well as protect our economy and society.
SARS would also have to provide advice to the Ministers of Finance and Trade and Industry on Tax and Customs matters.
From its inception, SARS has been guided by a fundamental principle called the Higher Purpose, closely linked to its mandate. The principle simply means that SARS and all who work there collect revenue to help government build a capable state to foster sustainable economic development that improves the well-being of South Africans.
Since its inception in 1997, SARS has over the years collected circa R18 trillion, to put the SARS Higher Purpose in action. Government has been able to pay old age, foster care, disability, and various grants, as well as provide basic public goods and services.
SARS uses data science, artificial intelligence and technology enablement to make it simple and easy for all taxpayers and traders to comply with their legal obligations. The institution is continuing to hone its capabilities to detect and respond to instances of non-compliance.
The Commissioner for SARS says: “In the next 25 years, we envisage a situation where “tax just happens”. This would imply that SARS will see an exponential increase in using structured data from third party sources domestically and internationally, as well harvesting data and insights from unstructured sources. Drawing on data science, machine learning algorithms, and artificial intelligence, it will see taxpayers be assessed in real-time. Our Vision 2024 of a “smart modern SARS”, strives to set the foundation for the next generation of tax administration, in a world where business models become increasingly digital, value chains are virtualised, and physical presence as the primary nexus to establishing taxing rights are replaced by economic presence.”