Markers and smart counters: inside Sars’s excise compliance plan

The South African Revenue Service (Sars) is doubling its efforts to develop a marker system for all categories of excisable goods in the country to enforce tax compliance, complete with hack-proof smart counters.

Sars commissioner Ngobani Johnstone Makhubu said this week the tax agency is looking for a partner to help it develop an advanced system to monitor tax payments and identify legal and illegal products.

Addressing a post-medium term budget policy statement (MTBPS) hosted breakfast by RMB, Makhubu said this work sought to sharpen Sars’s ability to “detect licit and illicit” excisable goods.

Oversight on businesses producing excisable goods with a physical presence on production sites remains important to compliance because Sars has found entities where banking flows and their financials are two different stories.

I’m convinced that there are books that are written for Sars and there are books that are written for the true genuine business.

In 2021, Sars installed counters to count cigarettes at factories, but malefactors have been able to find ways of tampering with the counters.

“We are looking globally now to find out what the smart counters are that we need to incorporate into this solution,” Makhubu said.

Tabling the MTBPS in parliament on Wednesday, finance minister Enoch Godongwana said Sars has played a key role in the government’s efforts to combat the illicit economy, particularly in alcohol and tobacco.

Through customs and excise modernisation, which includes enhanced cargo scanning, track-and-trace capabilities, and stronger frontline enforcement, Sars is disrupting the networks that enable illicit trade.