When Moody’s affirmed SA’s investment grade rating and upgraded the outlook from negative to stable recently, one of the drivers was that the change in SA’s political leadership had made it possible to start gradually rebuilding the institutions that had been eroded by the Zuma administration. The South African Revenue Service (SARS) was specifically mentioned, with the Moody’s update coming just days after SARS commissioner Tom Moyane was suspended at last. Last week’s announcement of results for the latest tax year by SARS and Finance Minister Nhlanhla Nene signalled that the process of rebuilding the tax authority and repairing the immense damage that the Moyane era has done to its credibility and effectiveness has begun. It is hard to underestimate how important that is: SARS collects more than 90% of the revenue the government relies on to fund its spending envelope. The fiscal framework has been under enormous pressure due to revenue shortfalls in recent years, with the shortf...
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