By Isabel Janse van Vuren
Tax Ombud, Judge Bernard Ngoepe, gave the keynote speech at the University of Pretoria.
The University of Pretoria’s (UP) department of taxation held a discussion on the office of the Tax Ombud titled ‘assessing the 2014/2015 annual report to Parliament’. This discussion formed part of the University of Pretoria’s Economic Management Sciences Talk Series. The discussion took place in Pretoria on 13 October.
Speakers at the discussion included the Tax Ombud, Judge Bernard Ngoepe; Chief Executive Officer: Office of the Tax Ombud, Eric Mkhawane; Executive Indirect Taxes: South African Revenue Services (Sars), Narcizio Makwakwa; Director of the African Tax Institute: University of Pretoria, Professor Riël Franzsen; and Tax Executive: ENSafrica, Dr Beric Croome.
Programme director, professor Madeleine Stiglingh, head of the department of taxation at UP opened the discussion by giving a brief history into the world of tax and the need for a Tax Ombud. She explained that the word ‘Ombud’ meant ‘agent’ or ‘representative’ in Swedish and that South Africa has a Tax Ombud, who according to the mandate will be looking at the procedural, administrative and service related problems people could have when dealing with the revenue service. The Tax Ombud reports directly to the Minister of Finance and will do this in the form of an annual report every year where the findings, recommendations and actions will be laid out. Professor Stiglingh was pleased to announce that the 2014/2015 annual report by the Tax Ombud has already been tabled in Parliament.
Vice-Chancellor and Principal, UP professor Cheryl de la Rey welcomed delegates to the event, as well as welcoming and introducing the keynote speaker, Judge Ngoepe saying: ‘As I think we all know, Judge Ngoepe has had a stellar record for his contribution, very broadly in South Africa.’ She went on by highlighting the judge’s career and achievements before becoming South Africa’s first Tax Ombud.
Judge Ngoepe started his address by saying ‘We are not launching the report. The report has already been launched and is in fact already with Parliament, but what we seek to do today more than anything else is to hear from the public.’ Judge Ngoepe went on to explain that he cannot assess his own work, it is up to the public to judge the work that the office of the Tax Ombud has done. He added that the public needs to tell the office of the Tax Ombud, where they can improve and what more can be done in order to be as effective as the Tax Administration Act 28 of 2011 would the office to be.
Judge Ngoepe stated that he was not planning on explaining exactly what is stated in the Tax Ombud’s annual report, because it is already in the report for everyone to read. Instead he said what he did want to talk about was ‘the issue of tax in general and perhaps the philosophy behind the question of tax.’ Judge Ngoepe continued by saying that the whole purpose of tax being to benefit the people of the country, and mostly the people who need assistance from the state in the form of service delivery. The judge also mentioned the fact that the office of the Tax Ombud sees itself as a member of a big family and collect tax within the limits of the Act that was created for this purpose.
‘Paying tax is not the nicest thing to do and those whose duty it is to collect tax will tell you that it is one of the most difficult things to do,’ said Judge Ngoepe. According to the judge, there have been many scholars who have written about how best to facilitate tax collection and how to change a tax payers outlook on paying their taxes. The judge suggested that this could be done by putting measures into place so that paying tax is made as easy as possible. The role that the office of the Tax Ombud, is currently and intends to play in the future, is to expedite and facilitate the collection of tax from the whole country in the best way possible, said Judge Ngoepe and that the office of the Tax Ombud is there to listen to the challenges people face and the complaints they have when dealing with Sars, this in turn helps Sars better facilitate the tax paying process.
From left: Judge Bernard Ngoepe, Dr Beric Croome, Narcizio Makwakwa, Prof Madeleine Stiglingh, Eric Mkhawane and Prof Riël Franzsen took part in a panel discussion about the Tax Ombud’s annual report for 2014/2015.
Judge Ngoepe said the statement has been made that the best way to make sure that people pay their taxes is by introducing a culture of cooperative compliance. In order to get this done Judge Ngoepe said: ‘We, therefore, need to nurture, first perhaps inculcate and then nurture, in tax payers the feeling that they need to cooperate as far as tax compliance is concerned.’ The judge went on to explain that this compliance cannot take place by ‘wielding the big stick’.
Judge Ngoepe went on to say that ‘we know we cannot do without tax and it is something which simply has to be paid.’ He then recounted a story from his youth about a taxi driver who had told him that he did not mind paying his tax because he explained that by doing that he knew that the government would look after him in his old age. The judge then explained that for anyone to be ‘inspired’ into paying tax they would have to know that the taxes being collected are being used for which it is meant and not to line the pockets of the corrupt. Judge Ngoepe said that he as the Tax Ombud is helping facilitating a process to collect tax from the people and then ensuring that that money is being used to the benefit of the needy. The judge explained that it is always a good thing to ask questions. The office of the Tax Ombud has to ask questions about the use of the money obtained by tax.
Judge Ngoepe concluded his address by thanking UP for all their contributions in the training of people in the field of tax and stated: ‘Tax, ladies and gentlemen, has become a very important issue.’
Following Judge Ngoepe’s address was a panel discussion led by professor Stiglingh. The panel consisted of Judge Ngoepe, Mr Mkhawane, Mr Makwakwa, Prof Riël Franzsen and Dr Croome.
During the panel discussion the annual report was discussed and opinions were asked of the panellists. Some of the interesting aspects discussed were learning what Mr Makwakwa’s reaction was to the annual report on behalf of Sars, to which Mr Makwakwa explained that it is a good thing that the public has a way of raising their issues outside Sars. It helps Sars that the issues are dealt with in a fair and independent manner and Sars appreciates the contributions made by the office of the Tax Ombud, Mr Makwakwa said.
Judge Ngoepe explained that the memorandum of understanding between the office of the Tax Ombud and Sars is there to ‘facilitate the interaction between the two institutions’ and the independence of the office of the Tax Ombud is governed by the Act.
Some of the statistics from the report we also mentioned in the discussion such as, the office of the Tax Ombud received 1 277 complaints but only 409 fell within the offices’ mandate and that more than 75% of the valid complaints received by the office were found in favour of the taxpayer. Only 14% of the contact made with the office of the Tax Ombud were rejected complaints.
Isabel Janse van Vuren BIS Publishing (Hons) (UP) is a sub-editor at De Rebus.
This article was first published in De Rebus in 2015 (Dec) DR 15.
