The Standing Committee on Finance has held a follow-up meeting with the South African Revenue Services (Sars) on Wednesday morning on Jonas Makwakwa, KPMG and Steinhoff, revenue raised in 2017/18, as well as illicit financial flows (IFFs) and the illicit tobacco trade.

Following legal advice and representations by the Minister of Finance, the Committee decided that because the Jonas Makwakwa and KPMG matters are being dealt with in the disciplinary inquiry into the conduct of Sars Commissioner Mr Tom Moyane, and are also highly likely to be relevant to the President’s Commission of Inquiry into Sars’ performance, it will not fully engage on these matters for now, to avoid undermining these two processes.

However, as soon as the outcomes of the two inquiries are finalised, the committee will engage further on these matters and possibly propose policy and regulatory changes.

The committee has urged that the disciplinary inquiry into the Sars Commissioner’s conduct be completed as soon as possible. The committee heard that the President’s Commission of Inquiry into Sars’ performance will be established in the next few days.

“We feel it is taking far too long to establish the commission and welcome its pending establishment,” said Mr Yunus Carrim, the Chairperson of the committee.
 
The committee once again requested the IRBA (Independent Regulatory Board for Auditors) to complete its inquiry into KPMG’s role in the Sars report reasonably soon.
 
Mr Carrim said: “We do not have the competency to make any final conclusions on the role of Hogans Lovell in the Makwakwa matter and believe that the Law Society and the pending Legal Practice Council and/or any other appropriate body should consider this. Any organisation carrying out this inquiry should include at least one retired judge. We also believe that consideration needs to be given to including the role of Hogans Lovell in the Makwakwa matter, as part of that Commission of Inquiry’s terms of reference.”
 
The committee welcomed the news that Sars raised R1 216.5 billion in the past financial year, but believes far more could be raised if it dealt more effectively with IFFs, and the illicit tobacco and illicit trade. The committee welcomed the formation of the Inter-agency working group, but wants to see results.
 
“We also reiterate our view that there should be an inter-ministerial committee by the Minister of Finance to more effectively tackle IFFs. This committee should include the ministers of Trade and Industry, Mineral Resources, Police and Justice,” said Mr Carrim.
 
Lastly, the committee believes that the President should, if possible, consider whether it is appropriate to include Sars’ response to IFFs, as part of the terms of reference of the commission in a way that does not unduly delay the commission’s other work.
 

Issued by Parliamentary Communication Services on behalf of the Chairperson of the Standing Committee on Finance, Yunus Carrim