Jonas Makwakwa. Picture: SARS
Jonas Makwakwa. Picture: SARS

South African Revenue Service (SARS) commissioner Tom Moyane admitted that the saga around his second in charge, Jonas Makwakwa, who resigned under a cloud on Wednesday, should have been handled “differently and better”.

Moyane announced Makwakwa’s resignation at a hastily convened press conference on Wednesday, saying Makwakwa was on the verge of being suspended again — but he resigned instead. This time, Makwakwa’s suspension related to his appointment of debt collector New Integrated Credit Solutions (NICS) to assist with the tax agency’s debt collection.

The company was identified in the Financial Intelligence Centre (FIC) report that alerted SARS about some R1.2m in suspicious and unusual payments into Makwakwa’s bank account and that of his partner, Kelly-Ann Elskie.

Payments from NICS flowed to a company, Biz Fire Worx, of which Makwakwa is a director, according to the FIC report.

On Wednesday, Moyane said the Makwakwa saga had “taught SARS a valuable lesson” and that it could have “handled the matter differently and better”. Moyane was grilled over his handling of the Makwakwa matter in Parliament on Tuesday.

The FIC report was handed to Moyane in May 2016; he sat on it for four months and acted on it only after it was reported on in the Sunday Times.

Law firm Hogan Lovells was appointed to investigate the allegations, and contracted accounting firm PwC to assist. Hogan Lovells recommended that disciplinary action be taken against Makwakwa. However, SARS’s disciplinary process cleared him of all charges and he returned to work.

However, his return was controversial because the investigation by the Hawks into the allegations, and payments that Makwakwa received, had not been concluded and did not form part of the Hogan Lovells investigation nor the disciplinary process. This led to criticism that the process was a sham designed to shield Makwakwa, who was regarded as a staunch Moyane ally.