Nehawu and PSA to resume strike action at Sars amid tax season

The strike action by the two largest unions at the SA Revenue Service (Sars), which is set to resume from Tuesday, could affect tax collection at the agency which reported a surplus of R16.7bn in April, taking tax collection to R1.563-trillion during the 2021/2022 financial year.

The Public Servants Association of SA (PSA) and the National Education, Health and Allied Workers’ Union (Nehawu), which represent the majority of the nearly 13,000-strong workforce at Sars, said the industrial action would recommence after a meeting with management failed to reach agreement in June.

When the strike action began in May, Sars called on people to use its online services. It said at the time the industrial action had little impact on its operations.

The continuation of the strike action from Tuesday comes after Sars opened the tax collection season on July 1. Undercollection of tax due to industrial action could hurt an economy dogged by prolonged bouts of load-shedding and that is still trying to recover from Covid-19, the July 2021 unrest and recent flooding that hit three provinces.

Sars has introduced auto assessment that has seen it assessing taxpayers automatically based on data received from employers, financial institutions, medical schemes, retirement annuity fund administrators and other third-party data providers.

But the two unions insisted on Monday that the resumption of the strike action would have a negative impact on Sars’ operations, especially since it was the tax season.

The PSA and Nehawu downed tools on May 26 demanding increases of 11.5% and 12% respectively, above the 5.9% headline inflation forecast by the Reserve Bank for 2022.

The employer previously offered unions R70m to fund pay rises and R430m as a one-off gratuity payment for the 2021/2022 financial year. The R500m offer was set out in a confidential document that was leaked to Business Day. The R500m offer was rejected by unions who had argued that it would translate only to a rise of 1.3% and a one-off R3,000 cash gratuity.

Sars’s 13,000 employees cost the agency nearly R8bn, making personnel costs the biggest driver in its total expenditure of R11.7bn. In his budget vote on May 18, finance minister Enoch Godongwana said Sars had been allocated a total of R34.3bn “to build the capacity of human resources and implement ICT projects”.

In a statement on Monday, Nehawu general secretary Zola Saphetha said the union held a national meeting on Friday to chart a way forward regarding the wage deadlock.

“As Nehawu, we have tried to engage the institution since May and they remained stubborn with the 1.39% [offer] that is way below the inflation rate of 5.9%,” said Saphetha, stressing that the tax agency had rejected the union’s demands including a R2,000 “token of appreciation” to all employees, and an annual 1.5% pay progression.

Nehawu spokesperson Lwazi Nkolonzi told Business Day that no services would be rendered at Sars from Tuesday: “Sars will come to a standstill.”

PSA assistant GM Reuben Maleka told Business Day: “We are together with Nehawu on this. The strike resumes on Tuesday. The strike will have an impact because, obviously, it’s the tax season so they [Sars] will need people to handle tax returns. We are rolling from Tuesday.”

Sars spokesperson Siphithi Sibeko did not respond immediately to a request for comment.

mkentanel@businesslive.co.za