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Cape Town - Judge Dennis Davis told Fin24 it's not his job to get involved in issues between Finance Minister Pravin Gordhan and the Commissioner of the South African Revenue Service (Sars) Tom Moyane.
Davis, who heads up the Davis Tax Committee, tasked with looking into South Africa's tax system, clarified by phone the role of his committee.
"Our job is to see how we can achieve congruency between tax policy and tax administration. If you don't have that (congruency) the situation is unsustainable and intolerable," he said.
Davis reiterated that his committee is tasked with looking into issues of transfer pricing, base erosion and profit sharing and whether the current Sars operating model can deal with that.
"Our job is also to look into whether broadly speaking the Katz committee's view of an independent Sars was correct and if it was correct, if the model is still congruent with that idea. That remains our position."
Davis further said that Moyane was aware of his committee's current inquiry into the governance and accountability model at Sars. "We've met Mr Moyane. He knows what we're doing and he's been very cooperative," Davis said.
He emphasised that committee doesn't get involved in any disciplinary matters between Gordhan and Moyane. "That has nothing to do with us. That's for another inquiry."
The Huffington Post reported on Thursday that Davis will look at the closure of a number of enforcement units within Sars.
Davis and a delegation on Tuesday made a representation to Parliament’s standing committee on finance about progress made with the Committee’s work since its inception in 2013.
During the briefing, Davis said his committee was tasked with inquiring whether:
- the Sars governance and accountability model proposed by the Katz Commission is still relevant in 2016;
- the current Sars operating model can deal with the various recommendations the Davis Tax Committee had made regarding base erosion and profit shifting and small and small and medium enterprises; and
- the Sars current operating model can deal with illicit financial flows from Sars from a tax and customs and excise perspective – and if these two areas should be separated.
The inquiry will also extend to consider the rights of a taxpayer and whether the tax ombud's powers need to be extended.
READ: Gordhan climbs into Sars top management
On Wednesday, the perceived breakdown in the relationship between Moyane and Gordhan became more apparent than ever when Gordhan admitted in responses to parliamentary questions that he couldn’t assure the veracity of the information provided by Sars, as there was a lack of accountability and co-operation from the Revenue Service.
Sars has in the meantime issued a statement, saying it noted with “dismay” media reports in which Sars’ leadership is “unjustifiably accused of lack of accountability”.
“The Sars wishes to express its deepest concern and disturbance at this turn of events that cast aspersions and blemishes on the character and integrity of its leadership,” the statement read.
It continued, saying the leadership of the Receiver of Revenue has met Gordhan eight times since he took office in late December last year to discuss “issues of mutual interest”.
“In this regard, the Sars’ record of meetings attest that the current Finance Minister has never at any point expressed lack of confidence and/or lack of accountability in the leadership of the Sars.”
