Budget 3.0: SARS Gets a Major Cash Injection, But Will It Deliver?

In a bold move to ramp up tax collection efforts, Finance Minister Enoch Godongwana has announced an additional R4 billion in funding for the South African Revenue Service (SARS) over the next three years, bringing the total additional allocation to R7.5 billion.

Delivering his third national budget on 21 May 2025, Godongwana confirmed that the initial plans to raise VAT to fund government expenditure have been abandoned, and that a fuel levy increase set for June won’t be sufficient to address the country’s fiscal shortfall over the medium term. With limited options to grow the tax base, government is placing its bets on SARS to recover more from existing taxpayers.

To meet these ambitious targets, SARS Commissioner Edward Kieswetter has already onboarded 500 new debt collectors, with 250 more expected in June. He estimates these efforts could generate at least R20 billion, targeting a broader R120 billion in outstanding composite debt. Godongwana is even more optimistic, projecting potential collections of up to R35 billion.

However, with little expansion in the tax base, it’s clear that SARS will be turning up the heat on individual and corporate taxpayers alike. Increased audits and disputes are expected as SARS intensifies its collection drive.

Now more than ever, having robust tax risk insurance is essential. If you or your clients are selected for an audit or face an unfair tax reassessment, this cover ensures expert support without the stress or financial burden.

Contact us today, before SARS comes knocking.