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On Friday, some of the highest profile witnesses appeared before the Nugent Commission of Inquiry into the South African Revenue Service. They include former finance minister Malusi Gigaba, current Finance Minister Nhlanhla Nene, tax expert and chair of the Davis Tax Committee, Judge Dennis Davis, and Treasury official Solly Tshitangano.
Here are the day’s top revelations, as told to retired judge Robert Nugent.
1) Why did Gigaba propose a Sars inquiry to both former president Jacob Zuma and President Cyril Ramaphosa in the first place?
The former finance minster said that he had made the proposal for an inquiry into the governance at Sars because there were questions being raised by investors and that public perception of the institution was collapsing.
“We needed to fix the credibility, the administration, the governance of our tax administration. And so to do that, we didn’t only need to reform the tax administration, we needed to deal with the credibility of the institution. We could take the step of tinkering with the leadership, but we felt that there was something more we needed to do to address the credibility of the institution so that we provide a more profound, more in-depth approach going forward, and that is why we made the proposal of the commission,” he said.
2) Questions unanswered: Why did suspended Sars boss Tom Moyane go to Russia in 2017?
When grilled about the fact that there was no report handed in by Moyane following a “rushed trip” to Russia in November 2017, Gigaba said that he did not suspect anything untoward about the trip and that he assumed, as a member of Brics, that Moyane was meeting Russia to discuss business related to that. Gigaba had signed off on the trip and gave Moyane the go-ahead.
“If there was anything wrong about the trip that came to my attention, I would have then taken action. I had no reason to suspect something was not right,” Gigaba told evidence leader Advocate Carol Steinberg.
Acting Sars commissioner Mark Kingon earlier this week submitted a request to Moyane for information regarding the nature of the trip and this was sent to the commission.
3) Nhlanhla Nene had to call Tom Moyane to order
Speaking about his previous term as the finance minister, Nene alluded to how his relationship with Moyane was somewhat strained, and that he often had to call Moyane to order to focus on things like tax revenue collection, despite Moyane’s focus which was on the “so-called rogue unit at the time”.
“There is no perfect relationship but there could be a professional relationship. In the period I worked with the commissioner‚ we had a number of issues to deal with and I reached a point where in some instances‚ I had to point out to the commissioner that he was paying too much attention to the so-called rogue unit rather than tax collection‚” Nene said.
4) Judge Dennis Davis and his ‘unpleasant’ relationship with Moyane
Davis, who was at the time head of the Davis Tax Committee when he was appointed by then finance minister Pravin Gordhan in 2013, spoke about how when Tom Moyane took up the position of Sars commissioner in 2014, the committee was not given the final report on the proposed restructuring of the operational model at the tax agency, put together by Bain (see point 5). Davis called the proposal “insane”. Eventually, the relationship between the pair seemed to have headed south
“Mr Moyane wouldn’t give us [a report]. In many instances we couldn’t get figures. Our information dried up. We were working without any cooperation from Sars at all,” Davis said.
5) Global consultancy Bain was not appointed properly
Solly Tshitangano, procurement officer from national treasury, said at the commission that the process in which Bain was appointed by Sars was rushed and improper.
“The process was not done properly. You cannot say the company was properly appointed,” he said, as he described to the commission how the standard 21-day turnaround period for tenders was shortened to a week.
“My suspicion is that Bain may have been approached, were aware of the scope and may have started preparing [before other companies].”
