The South African Revenue Service (SARS) has indicated a strategic shift toward increased enforcement measures and audits during the 2026/27 budget cycle. This move comes in response to the failure of previous VAT proposals aimed at boosting government revenue.

Focus on Compliance and Audits

SARS officials have signaled that tax compliance will be enforced more rigorously, with audits targeting sectors previously overlooked and higher scrutiny on large-scale taxpayers. Analysts suggest that the agency intends to recover potential revenue gaps and improve overall fiscal performance.

Implications for Businesses and Individuals

Businesses and individuals are advised to review their tax reporting procedures and ensure full compliance with SARS requirements. Non-compliance could result in penalties, audits, and increased scrutiny, highlighting the agency’s intent to tighten enforcement.

Policy and Revenue Outlook

Experts note that while the VAT proposals failed to achieve projected revenue, SARS’s intensified enforcement strategy could help stabilize government finances and ensure funds for public programs. The focus is expected to include digital monitoring, sector-specific audits, and enhanced data analytics.