– Finance Minister Tito Mboweni does not agree with the government’s decision to maintain the ban on the sale of alcohol and cigarettes
– SARS has missed out on an estimated R1.5 billion in tax revenue as a result of the ban
– Mboweni has not ruled out approaching the IMF for a loan as SARS struggles to collect tax revenue .
The Sowetan Live reported that Kieswetter explained that SARS was already R13bn behind on tax collection due to the struggling economy. “This is driven mainly by VAT, excise, by import duties and by pay as you earn and I have to indicate that this will get significantly worse once the tax relief measures kick in because that then introduces further deferral of some of these payments, and so we anticipate a significant decline in tax revenue purely driven by the state of the economy as well as the tax relief measures that government has announced.”
“I can share with the committee that months to date, in terms of beer sales, we have under recovered R664m, in terms of wine we’ve under recovered almost R300m, spirits just over R400m and cigarettes just over R300m. “So year to date our under-recovery from these activities is one and a half billion and we’re just through the first month,” said the tax chief, while adding that they were concerned that the illicit trade was flourishing during the lockdown.
Mboweni hs not ruled out approaching the International Monetary Fund (IMF) for a $4.2bn loan (R78 billion). He addressed concerns over the potential loan. “We’ve not begun any negotiations, it’s a long process which will take us a number of weeks to get into.
We’ve not closed the window, it’s something we should still look into. “Will there be any conditions attached? My understanding is, there will be no conditions attached. In fact, I’m not interested in discussing any conditionalities with the IMF. “We know what to do for our economy and we’ll do what we can ourselves, so I’m not interested in discussions on conditionalities.”