Can we believe all of the amazing collection stories we hear about the SARS? I was recently both a victim and a spectator in what I believe to be an internal scam at SARS. I initially had an amount owing to me by SARS for a tax year. After receiving an IT34, statement of account, all that remained was for them to make payment.
However payment was not forth coming, instead there was request for additional reconcilement of accounts, this was duly done and returned to the receiver. Then, a revised IT34 statement of account was forwarded to me which now indicated the full tax amount as previously paid in by me was now outstanding. On examining the IT34 statement of account (revised) it was noted that no tax paid for that year was actually reflected, having the net result of a rather large amount now due.
Accounting sources tell me that this practice is quite widespread and that errors can take up to three months to correct and in many cases SARS demands payment before any such errors can be corrected.
So where is the scam? That took me a while to figure out, and it was only after I heard a comment passed by one of the SARS employees, regarding collection targets for March that I realized what was happening.
If targets are not being made, the first objective is to reduce payouts, and if possible turn the payouts into income for SARS, what better way than to raise a query, disallow the payout due and until the entire bureaucratic mess is resolved, the amounts are reflected as due and part of recoveries, resulting in overstated figures due to SARS!
The SARS inspectors responsible for the inflation of reports get to claim the credit for the collections, and life goes on, with them making targets and bonuses until the misadministration is corrected. So not only is the public milked at every turn, the public also get to fund performance bonuses which are not earned, and are financing imaginary achievements with real money!