Publications
Partners
Cape Town – Judge Dennis Davis said his committee's role is not to investigate the closure of certain units within the South African Revenue Service that were shut down since Tom Moyane took over as Commissioner of the organisation.
Davis, who heads up the Davis Tax Commission since its inception in 2013, was speaking to Bruce Whitfield on 702’s Money Show on Thursday.
In the interview, he set the record straight about the committee’s mandate for an inquiry into Sars governance and operating model.
Whitfield asked Davis if the Tax Committee was considering the closure of certain units within Sars – “the sort of enforcement units that were doing lots of checks and balances”.
Closure of tax units
Davis responded: “No, we’re not doing that at all. I don’t (know) where that came from. Mr Moyane came to us last year still and told us: ‘This is our operating model. This is how it works.’"
“And we (as a committee) thought we’d better look into the operating model to see whether in fact it could bear the weight of what we think should be the ideal tax system for South Africa going forward.”
Davis said if the investigation shows that certain units are closed and others are opened, the committee will try and find out if those decisions promote tax collection from a “legitimacy and an efficiency point of view”.
The judge was also critical of media reports suggesting that he said the relationship between Finance Minister Pravin Gordhan and tax boss Tom Moyane is “not good”.
'I'm not investigating relationships'
He said the Finance Minister asked him "a long time ago" to look at the question of whether there should be a congruence between tax policy on the one hand and tax administration on the other.
"Or to put it more specifically, did the recommendations of the Katz Commission, which some of us were on, and basically gave rise to an independent Sars, hold up in the year 2016 and if so is Sars’ model at present congruent with those particular recommendations."
Davis emphasised that he would be looking at issues relating to taxpayer’s rights on the one hand and illicit flows.
"That includes the stuff that came out of the Panama papers. Is the operating model at Sars good enough to deal with that; and what about base erosion and profit shifting. We’ve generated a thousand papers - if not more - of recommendations and we’re looking at whether Sars can implement those and the same goes for high net-worth individuals.
"These are issues that have been there for months and I don’t really understand where all these (media) reports are coming from. To be honest, the issues that have been in the newspapers – that’s not my job. And in fact, I wish they’d leave us alone on that.”
Whitfield responded, saying to Davis there had been reportage of increased tension between the Finance Minister and the Tax Commissioner.
READ: Judge Dennis Davis: I'm not probing disciplinary matters at Sars
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.
READ: Gordhan climbs into Sars top management
In response to Whitfield's question, Davis said he was asked the same question in Parliament on Tuesday.
"David Maynier from the opposition asked us when we presented to Parliament just the other day, if we are getting involved in a civil war. And I said: 'No, nothing could be further from the truth'," said Davis.
Davis reiterated that he and the Tax Committee are tasked with developing recommendations.
“We want to help make Sars the best possible tax collector.
“But if for example the Minister and the Commissioner want x, y and z investigated that’s a different matter entirely. It’s not my job.”
Read Fin24's top stories trending on Twitter: Fin24’s top stories
