The South African Revenue Service (SARS) has collected significantly more tax than anticipated from the two-pot savings withdrawals system. Commissioner Edward Kieswetter stated that SARS has collected close to R11 billion in taxes, exceeding initial estimates of R5 billion to R6 billion. While this boost to state coffers has helped stimulate the economy, Kieswetter warned of the long-term impact of withdrawing R43 billion from pension funds, which represents a substantial depletion of the country's savings pool.
Commissioner Kieswetter said that SARS will make sure to first keep any other tax that is owed to the revenue service before it releases the funds.The taxman was able to collect between R11 billion and R12 billion in taxes from the two-pot savings withdrawals system since it began in September 2024. "The tax that we then withheld on that is just short of R11 billion," Kieswetter said during the webinar.
“And we've issued directives for just short of a billion rand of debt to be collected. So overall, there is a higher than assumed contribution to the fiscus. We think probably about double what we thought,” he explained. “It’s R43 billion that to the current expenditure. If people were buying disposable goods, they were paying VAT, on that, or sin taxes. it’s swings and roundabouts. It’s R43 billion that will no longer grow and add to the future of savings.
However, the actual tax take from these withdrawals has not only helped boost state coffers, but also injected much-needed spending into the economy.
Taxation Pension Funds Economy SARS South Africa
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