The South African Revenue Service (SARS) is stepping up efforts to bring more businesses in the informal economy and taxi industry into the tax system.
According to a report by IOL, Finance Minister Enoch Godongwana revealed details of the tax authority’s plans in a written parliamentary reply on government’s efforts to broaden South Africa’s tax base.
IOL reported that SARS has identified the informal economy and taxi sector, including e-hailing services, as priority areas for improving tax compliance.
SARS targets low tax compliance
As reported by IOL, Godongwana said SARS is focusing on improving taxpayer registration, filing and payments in areas where compliance remains low.
The publication reported that since the 2024/25 financial year, SARS has registered 21,890 taxpayers in the informal economy who were previously not registered. These registrations generated R314 million in revenue.
According to the IOL report, SARS is using available data, digital platforms, education programmes and simpler registration processes to identify businesses operating outside the tax system.
The taxi industry and e-hailing services are also receiving increased attention. IOL reported that SARS intends to use risk assessments, data and targeted interventions to strengthen compliance across the sector.
Crackdown goes beyond the taxi industry
IOL also reported that SARS is increasing its focus on illicit financial flows and financial crimes, including tax evasion, customs fraud, money laundering, corruption and organised crime.
According to figures highlighted in the report, SARS recorded 10,142 customs seizures valued at R6.3 billion during the 2024/25 financial year.
A further R6.1 billion was recovered through action linked to VAT fraud and illicit gold trading.
Godongwana said these enforcement efforts are aimed at recovering revenue, preventing losses to the state and disrupting criminal financial networks.
IOL further reported that SARS is working with Statistics South Africa and other partners to improve how the country measures activity across the formal, informal and illicit economies.
The expanded compliance drive shows government is looking beyond existing taxpayers as it searches for additional revenue.
By bringing more informal businesses and operators into the tax system, SARS aims to broaden the tax base while strengthening compliance across parts of the economy that have historically been difficult to monitor.
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