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The Citizen
a day ago
- Business
- The Citizen
SA losing nearly R30bn to illicit cigarettes as Sars tools face delays, says Godongwana
Illicit cigarette trade has become a major economic and enforcement issue. Efforts by the South African Revenue Service (Sars) to curb the illicit cigarette trade have been hampered by delays, with South Africa losing nearly R30 billion over the last five years. This was revealed by Finance Minister Enoch Godongwana in a parliamentary reply. EFF MP Thapelo Mogale asked the minister to disclose the total revenue lost as a result of cigarette smuggling and the illicit trade. He also requested information on the measures introduced to tackle the issue and how effective these have been in recovering lost tax income and ensuring offenders are prosecuted. Godongwana on illicit cigarette trade losses In his written reply, Godongwana said illicit trade and smuggling are 'hard to reliably quantify' given their covert nature. However, he pointed out that the illicit cigarette trade has become a major economic and enforcement issue, with estimates indicating that as much as 70% of cigarettes sold in the country are illegal. This has resulted in annual tax revenue losses exceeding R27 billion. ALSO READ: Illicit tobacco sales a drag on excise tax collections The minister explained that according to Sars data, revenue from tobacco and cigarette products dropped from R13.4 billion in 2015-16 financial year to R9.4 billion in 2024-25, a 29.6% (R4 billion) decline over ten years. The most notable drop, of 44.9%, occurred in 2020-21 due to the cigarette ban during the Covid-19 lockdown. Sars measures against illicit cigarette trade Sars, Godongwana highlighted, has implemented a multifaceted strategy to combat the scourge of illicit trade of tobacco and cigarettes. He said the tax authority has adopted a long-term strategic approach that includes frontline interventions, targeted audits, and the use of advanced technology. Regarding frontline operations, the minister explained that seizures of illicit cigarettes are being conducted at various ports of entry by customs border operations teams, in collaboration with other government agencies. These efforts also extend to inland areas. 'This ensures that Sars does not only focus on revenue recoveries, but [also on] removing illicit goods from circulation.' READ MORE: SA loses R30 billion in revenue due to illicit trade in cigarettes and liquor He emphasised that compliance audits are prioritised, covering the entire value chain, to ensure adherence to relevant laws. 'This methodology enables an end-to-end audit of the entire value chain and ensures that a company is scrutinised from the point of raw material supply, its entry into the manufacturing warehouse, to calculating how many cigarettes could be produced at any given time, considering the appropriate yield and capacity analysis.' Godongwana pointed out that Sars has integrated data and advanced technologies to monitor the tobacco supply chain and detect illicit activities. This involves the use of CCTV surveillance at manufacturing facilities to monitor production and prevent tax evasion. However, this initiative has faced delays due to legal challenges from certain industry stakeholders. 'As a stop-gap measure, Sars intends placing inspectors at these factories, on a full-time basis, depending on the availability of funding and budget. 'In addition, cigarette counters were made mandatory for all licensed manufacturers to assist Sars with production statistics.' Investigations and arrests Another tool in the fight against illicit trade is Sars' criminal investigation unit, which was established to probe complex tax evasion schemes. Godongwana said the unit continues to investigate cases involving tax non-compliance, smuggling, diversion, ghost exports, and misdeclarations, especially in high-risk industries such as tobacco and cigarettes. The minister revealed that international trade agreements and tools are being used to improve intelligence sharing and strengthen enforcement against illicit trade. He highlighted specific enforcement successes, including arrests and prosecutions. READ MORE: JMPD cracks down on illicit cigarette smuggling in Brixton The Sars criminal investigation unit has handed 129 customs and excise-related cases to the National Prosecuting Authority (NPA) over the past five years. Currently, 105 of these are on the NPA roll, with 33 currently on trial and 72 awaiting trial dates. Eight of these cases specifically involve illicit cigarettes and tobacco. Four are currently on trial, while the remaining four are pending trial dates. Godongwana added that 32 customs and excise cases have resulted in successful convictions.
The South African
2 days ago
- Business
- The South African
SARS eFiling: How to update your banking and contact details
The South African Revenue Service (SARS) continues to notify taxpayers of auto-assessments that have been issued as the tax season has begun; however, some taxpayers may not have received the notices as they have probably changed their contact details. Here's a step-by-step guide on how you can update your banking and contact details on SARS eFiling. Here's how you can check/update your details on the SARS system: Log in to Click on 'Home'. Click on 'SARS registered details'. Click on 'Maintain SARS Registered Details'. Select the item you want to update: My Addresses My Bank Accounts My Email Addresses My Trading Name Details My eFiling Security Details If correct, you are all set to receive communication from SARS. If your details are incorrect or have changed: You can edit/change the details while still on the relevant screen. Remember to click on 'Done' and then 'Submit' once you have updated the details. According to the revenue service, the 'Forgot Username or Password' function will trigger a one-time password to your security contact details on the system. To check that SARS still has your correct email address and cell number, log in to and click on 'My Profile' on the top-left of the screen. If one of the security details has changed, you can update it here on the screen, but if both have changed, you will need to call the Contact Centre on 0800 00 7277 or visit a branch (remember to make an appointment first). Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1. Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X, and Bluesky for the latest news.
IOL News
2 days ago
- Business
- IOL News
Understanding South Africa's 2025 tax season: key filing dates and tips
Your complete guide to filing your tax and all your related questions answered! Image: Pixabay Tax season is officially in full swing. While some have already been selected for auto assessment, others will have to wait a little longer. IOL has put together a guide to help you and answer any questions you may have. This year's tax filing season officially kicked off in July, with auto assessments running from 7 – 20 July. For non-provisional taxpayers who were not auto-assessed, they will be able to submit and file their income tax returns between 21 July – 20 October 2025. Read more here - Brace yourselves, SARS is sliding into your inbox – Tax season starts now! Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ How to file your tax return The South African Revenue Service (SARS) explained that taxpayers are required to submit a tax return so that SARS can calculate their tax liability based on the income they declare and the tax-deductible expenses they have incurred for a year of assessment. SARS added that in some cases, after completing the assessment, a refund may be due to the taxpayer. SARS has also simplified its processes. Read more here - Tax Season | How to effortlessly file your SARS return in 20 minutes If you qualify for exemption but submit a tax return anyway and make an error, you could delay any possible refunds or even receive penalties for incorrect filing. Image: Motshwari Mofokeng, Independent Newspapers. What if I don't file? SARS explained that taxpayers who do not receive notifications from SARS that they are automatically assessed are encouraged to submit their tax returns in a timely and accurate manner from July 21. Failing to file, even when no tax is owed, can lead to administrative penalties of up to R250 to R16,000 per month for each return outstanding. "In more severe cases, persistent non-compliance may result in criminal charges, including prosecution for tax evasion. Importantly, SARS uses advanced data-matching systems and international reporting standards to detect undeclared income, so assuming you're not "under the Radar" is a risky gamble," Tax Consulting South Africa said. Read more here - Tax Season | The real price of not filing your tax return in South Africa Watch out for scams SARS has warned of scams during the filing season. "The taxpayers in the auto assessment category do not have to do anything if they are satisfied with the calculation on their tax returns. "If the taxpayer thinks that SARS has not captured all the necessary information, they are free to make changes on their tax returns and submit the missing information through eFiling by October 20," the revenue said. Read more here - If you get scammed we can't give you back your money, SARS tells taxpayers IOL
IOL News
2 days ago
- Business
- IOL News
Understanding South Africa's 2025 tax season: key filing dates and tips
Your complete guide to filing your tax and all your related questions answered! Image: Pixabay Tax season is officially in full swing. While some have already been selected for auto assessment, others will have to wait a little longer. IOL has put together a guide to help you and answer any questions you may have. This year's tax filing season officially kicked off in July, with auto assessments running from 7 – 20 July. For non-provisional taxpayers who were not auto-assessed, they will be able to submit and file their income tax returns between 21 July – 20 October 2025. Read more here - Brace yourselves, SARS is sliding into your inbox – Tax season starts now! Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ How to file your tax return The South African Revenue Service (SARS) explained that taxpayers are required to submit a tax return so that SARS can calculate their tax liability based on the income they declare and the tax-deductible expenses they have incurred for a year of assessment. SARS added that in some cases, after completing the assessment, a refund may be due to the taxpayer. SARS has also simplified its processes. Read more here - Tax Season | How to effortlessly file your SARS return in 20 minutes If you qualify for exemption but submit a tax return anyway and make an error, you could delay any possible refunds or even receive penalties for incorrect filing. Image: Motshwari Mofokeng, Independent Newspapers. What if I don't file? SARS explained that taxpayers who do not receive notifications from SARS that they are automatically assessed are encouraged to submit their tax returns in a timely and accurate manner from July 21. Failing to file, even when no tax is owed, can lead to administrative penalties of up to R250 to R16,000 per month for each return outstanding. "In more severe cases, persistent non-compliance may result in criminal charges, including prosecution for tax evasion. Importantly, SARS uses advanced data-matching systems and international reporting standards to detect undeclared income, so assuming you're not "under the Radar" is a risky gamble," Tax Consulting South Africa said. Read more here - Tax Season | The real price of not filing your tax return in South Africa Watch out for scams SARS has warned of scams during the filing season. "The taxpayers in the auto assessment category do not have to do anything if they are satisfied with the calculation on their tax returns. "If the taxpayer thinks that SARS has not captured all the necessary information, they are free to make changes on their tax returns and submit the missing information through eFiling by October 20," the revenue said. Read more here - If you get scammed we can't give you back your money, SARS tells taxpayers IOL
IOL News
2 days ago
- Business
- IOL News
South Africa risks missing out on millions in tax due to a lack of cryptocurrency regulation
Bitcoin has significantly outperformed Luno's assumptions. Image: AFP Half-a-billion rand. That's the minimum in extra tax the South African Revenue Service (Sars) could collect if local regulators made a single regulatory change and designated cryptocurrencies as an onshore asset. If digital assets, such as Bitcoin, were formally classified as an onshore asset, it would allow local asset managers more ease in creating exchange-traded funds (ETFs) tracking its price, opening access to investments in the digital currency to both retail and institutional investors. Against the backdrop of South Africa's sluggish economic growth, mounting debt and urgent social challenges, the increasing relevance of digital assets becomes both an investment opportunity and a potential source of tax revenue. South African founded Luno, which operates in more than 40 countries, has estimated through a conservative calculation that R540 million in tax revenue could be generated over five years. To arrive at the R540m figure, Luno assumed a slow adoption rate, and as little as 1% of institutional funds invested in a digital asset product such as a Bitcoin exchange traded fund (ETF). They applied conservative annualised returns and the relevant tax rates to reach the estimate. Given that Bitcoin has significantly outperformed Luno's assumptions, the actual tax revenue could be much higher. As the government is frequently seeking more sources of tax revenue, quick regulatory action on this front appears an easy win. ETFs are traded on stock exchanges and mirror the price of underlying assets such as currencies, commodities and metals, including gold, silver and platinum. Bitcoin fits naturally into this structure. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ But, because cryptocurrencies lack a formal designation as either onshore or offshore assets, asset managers remain reluctant to allocate capital to them or offer products such as ETFs that track Bitcoin. Much of financial institutions' 45% allocation limit for offshore investments is already absorbed by foreign stocks and other currencies. A simple onshore designation for digital assets could unlock vast new potential for both the asset industry and the fiscus. An onshore designation is also widely considered to be technically correct and best practice internationally. Bitcoin ETFs are neither obscure nor especially high-risk instruments. The basic principle remains: don't put all your eggs in one basket. Bitcoin ETFs are just another way to diversify portfolios and distribute risk more effectively. And over the past decade, Bitcoin has outperformed stocks and bonds on an absolute basis. According to StatMuse between July 10, 2015 and July 10, 2025, Bitcoin returned 41,261.3% and the S&P 500, a bellwether of the US stock market, returned 205.1%. This means R1 000 invested in Bitcoin in the early July 2015 would be worth around R413 613 a decade later, while R1 000 in the S&P 500 would return about R3 051. Bitcoin often behaves differently to equities and bonds, offering investors diversification and a way to earn returns on their money when their other investments are weaker. The cryptocurrency recently reached an all-time high of over R2 010 800, reflecting a more than 1 000% increase in just five years. Without regulatory clarity, local institutional investors are unlikely to capitalise on cryptocurrency returns, depriving the fiscus of the tax revenue that would otherwise be generated. Internationally, sentiment has already shifted. BlackRock, the world's largest asset manager, launched its own Bitcoin ETF in 2024 when US regulations permitted such. The Bitcoin ETF surpassed the value of the Bitcoin gold ETF, its previously largest and a long-time store of value In November 2024 and then became the fastest-growing ETF in US history, amassing more than $70 billion (R1.2 trillion) in assets under management by early June 2025. It grew five times faster than the fastest growing ETF, that held the previous record, tracking the gold price, owned by US bank State Street. In the UK, a pension fund made headlines in late 2024 by strategically allocating 3% of its portfolio to Bitcoin, signalling a fundamental shift in how mainstream finance views the digital asset class. South African regulations and financial regulators need to keep up with a changing cryptocurrency landscape. Recently, the Pretoria High Court found exchange control regulations from 1961 were not fit for purpose regarding cryptocurrencies and that with cryptocurrencies having been in existence for 15 years, it was time regulators caught up and accommodated them. Both a designation of onshore for cryptocurrencies and clearer exchange control regulations around cryptocurrencies are essential. Regulators cannot wish digital assets away or become so draconian, as happened in Nigeria, that trading in cryptocurrencies moved underground to unregulated peer to peer networks, away from any accountability. It's not just investors who stand to gain from clearer regulation. With transparent and fair rules, digital assets could become a robust new source of tax revenue, something South Africa desperately needs. At present, tax from digital asset gains remains relatively insignificant, because government policy hasn't kept up. The only thing that is keeping a cryptocurrency boost for the South African economy and fiscus is political will. Marius Reitz General Manager Luno: Africa and Europe Image: Supplied Marius Reitz is the General Manager Luno: Africa and Europe *** The views expressed here do not necessarily represent those of Independent Media or IOL. BUSINESS REPORT
