SA must find new ways to recover the billions in untaxed revenue - Maswanganyi

CAPE TOWN - Standing Committee on Finance chairperson, Joe Maswanganyi, said that South Africa must find new ways to recover the billions in untaxed revenue.

As the National Treasury considers raising value-added tax (VAT) to fill the funding gap, it suggested untaxed revenue and cost-cutting could go a long way in addressing the country’s funding challenges.

Maswanganyi and chairpersons of Parliament’s finance committees were addressing a parliamentary finance cluster briefing on Monday to discuss the economy and Wednesday's budget.

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Maswanganyi said the country needed to modernise its tax infrastructure if it wanted to optimise its revenue collection.

He said that almost R800 billion remains uncollected.

"SARS has identified that there’s almost R800 billion uncollected tax revenue due to unpaid debts, overdue returns and fiscal leakages. We have to enhance the revenue collection requirements to bolster SARS' financial and institutional capacity."

SCOPA chairperson, Songezo Zibi, meanwhile, said that the state should look at being more efficient and spending less on items like allowances for diplomats if it wanted to raise the R60 billion shortfall.

"We must look at how government spends money and realise savings from there," said Zibi.