New South African Revenue Service (SARS) commissioner-designate, Ngobani Johnstone Makhubu has been urged to tighten screws on traders operating in the illicit economy and competing head-on with formal businesses that are driving economic and tax revenue growth.
The Black Business Council (BBC) said this after Makhubu was named successor to incumbent Edward Kieswetter, who has been at the helm since 2018.
Makhubu has been Sars deputy commissioner responsible for taxpayer engagement and operations since 2023. He will walk into the job after National Treasury last year strengthened SARS’ capacity to deal with tax dodgers by granting it an additional R7-billion over a three-year period. The money would assist the revenue service to recruit 1 500 debt collectors.
BBC deputy president Gregory Mofokeng said he hoped that Makhubu will continue implementing reforms that the Sars management have rolled out.
“SARS has requested additional funding to tackle tax dodgers and collect more money for the fiscus. We remain hopeful that under Makhubu’s leadership that project would also continue.
“There is a lot of illicit trade that is happening in the country, whether you are talking counterfeit goods or illegal cigarettes, and SARS plays a very important role. And we are hoping that SARS will double down on efforts to clamp down on those practices,” Mofokeng said.
At its revenue collection announcement this week, SARS stated that the shadow economy resulted in SARS losing over 5% of the R2.1-trillion revenue it collected in the 2025/2026
financial year.
Said Kieswetter: “The illicit economy continues to drain the country’s resources, distort competition, and undermine public confidence in the tax system.
Activities such as smuggling, customs and excise fraud, under‑declaration, counterfeit trade, fuel and tobacco syndicates, and organised tax crime divert resources away from essential public services and place compliant taxpayers and legitimate businesses at a disadvantage.
SARS said the fiscus loses over R100-billion in revenue each year to the illicit economy.
“We will not allow criminal syndicates to hollow out the tax system. SARS, working with other law-enforcement agencies, is determined to disrupt, dismantle, and shut down illicit trading networks, and to make non‑compliance hard and costly,” said Kieswetter.
Mofokeng said, “When formal businesses, like British American Tobacco, close down due to the illicit economy, the reality is that we are losing jobs and de-industrialisation. And this is on the back of illegal cigarettes thriving in the country. We do have a problem we need to solve and SARS must come to the party as far as this is concerned.
“We cannot have a situation where we are losing jobs and factories are being closed just because illegality is thriving. [Failure to deal with the illicit economy] would lead to a mafia state because at the end of the day people are not going to stop smoking tomorrow, so they will smoke what’s available and what’s available is illegal.”
Mofokeng stated that Makhubu would also need to deal with the growing illicit trade in alcohol.
Makhubu joined SARS in 2016 as the group executive responsible for procurement after exiting Eskom. In the August 2017 he was appointed acting chief officer for finance and a year later he occupied the role on a permanent basis, focusing on procurement and collecting tax from corporate real estate.
- New South African Revenue Service (SARS) commissioner-designate, Ngobani Johnstone Makhubu has been urged to tighten screws on traders operating in the illicit economy and competing head-on with formal businesses that are driving economic and tax revenue growth.
- The Black Business Council (BBC) said this after Makhubu was named successor to incumbent Edward Kieswetter, who has been at the helm since 2018.
- Makhubu has been Sars deputy commissioner responsible for taxpayer engagement and operations since 2023.
- He will walk into the job after National Treasury last year strengthened SARS’ capacity to deal with tax dodgers by granting it an additional R7-billion over a three-year period.
- The money would assist the revenue service to recruit 1 500 debt collectors.
