- SARS collected over R992 billion in net revenue during the first six months of the 2026/27 financial year, surpassing budget projections
- Finance Minister Enoch Godongwana raised the full-year revenue target after the stronger-than-expected mid-year performance
- SARS Commissioner Johnstone Makhubu warned that keeping up revenue growth depends on economic expansion and job creation
Source: Getty Images
SOUTH AFRICA — The South African Revenue Service collected R992.2 billion in net revenue during the first half of the 2026/27 financial year, outpacing the February 2026 Budget estimate by R15.5 billion, or 1.6%.
According to IOL, gross collections reached R1.231 trillion by 30 September 2026, before R239.1 billion in tax refunds were paid out. Compared to the same period in the prior financial year, net revenue climbed by R67.4 billion, representing a 7.3% year-on-year increase.
Godongwana revises full-year revenue target
Finance Minister Enoch Godongwana used his Medium-Term Budget Policy Statement (MTBPS) to revise the full-year revenue target upward by R17.1 billion, setting a new goal of R2.144 trillion. The adjustment came even as National Treasury trimmed its 2026 economic growth forecast from 1.6% to 1.2%.
Godongwana attributed part of the stronger performance to gains in corporate income tax, dividends tax, and value-added tax (VAT). Collections across pay-as-you-earn (PAYE), corporate income tax, and domestic VAT all came in higher than projected, while VAT refund payouts remained below initial estimates. Officials nonetheless cautioned that support from commodity prices could diminish over time.
Compliance drives R137.7 billion in additional revenue
SARS, which warned taxpayers about own-account bank transfers, reported that compliance interventions contributed a preliminary R137.7 billion in the first six months. Of that total, R76.3 billion came from direct cash collections and R61.3 billion from prevented revenue leakage.
SARS Commissioner Johnstone Makhubu described the results as evidence of the system's durability, while stressing that long-term sustainability hinges on structural economic conditions.
"The year-to-date outcome demonstrates the resilience of South Africa's revenue system. However, as reflected in the Minister's speech, sustainable revenue growth ultimately depends on economic expansion, investment, job creation and broad-based compliance," Makhubu stated.
He also underscored the social value of enforcement efforts:
"Every rand recovered through compliance interventions protects honest taxpayers and strengthens the fiscal framework."
Source: Getty Images
SARS ruling benefits property, energy sectors
In a related article, Briefly News reported on the Supreme Court of Appeal ruling that allows certain upfront loan-raising fees to qualify as deductible financing costs under the Income Tax Act. The case involved Cornucopia Trust, which challenged SARS after the tax authority rejected its deductions.
The court found that the fees were part of the cost of obtaining credit, like interest, and could affect debt-reliant sectors such as property, renewable energy and infrastructure. But the ruling does not make every loan-related expense deductible: legal, advisory and administrative costs remain excluded.
Source: Briefly News