SARS Reports R924.7 Billion in Revenue, Surpasses Targets Amid Strong Growth

By 30 September 2025, SARS reported a net revenue collection of R924.7 billion, surpassing expectations and marking another milestone in the agency’s modernization and compliance-driven strategy.

The South African Revenue Service (SARS) has welcomed Finance Minister Enoch Godongwana’s Medium-Term Budget Policy Statement (MTBPS), which underscored South Africa’s fiscal resilience and ongoing efforts to stabilize public finances. By 30 September 2025, SARS reported a net revenue collection of R924.7 billion, surpassing expectations and marking another milestone in the agency’s modernization and compliance-driven strategy.

The figures reflect a year-on-year growth of R78.6 billion and a surplus of R18 billion against the printed estimates. SARS noted that nearly half of this overperformance resulted directly from enhanced compliance measures, demonstrating the impact of its risk management and enforcement reforms.

“The MTBPS sets out bold measures to strengthen the country’s economic resilience. SARS is committed to supporting these objectives by focusing on robust revenue collection, improved compliance and trade facilitation through consistent effort, operational excellence, and innovation,” said Commissioner Edward Kieswetter.

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Record Revenue Performance: A Strong First Half

SARS recorded gross collections of R1.157 trillion, offset by refunds amounting to R232.9 billion, resulting in net revenue of R924.7 billion for the first half of the 2025/26 financial year.

The revenue service’s compliance programmes—including targeted audits, debt collection drives, and data analytics—secured R131.6 billion in additional revenue, up from R122.6 billion the previous year. Debt collections rose 7.5% to R47.1 billion, underscoring the agency’s expanding fiscal contribution.

SARS attributed these results to the commitment of its workforce and the cooperation of compliant taxpayers.

“Behind these numbers are the dedicated SARS employees who perform millions of little things daily, and many compliant taxpayers whose contribution makes this success possible,” said Kieswetter. “These results underscore SARS’s effectiveness in revenue collection and signal a positive outlook for South Africa’s fiscal position.”

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Sectoral Strengths: Broad-Based Revenue Growth

The 2025/26 fiscal period saw resilient performance across most major tax categories, despite headwinds in global commodity markets.

Corporate Income Tax (CIT)

• Year-to-date CIT Provisional Tax payments reached R164.5 billion, up 9.5% (R14.2 billion) from the prior year and exceeding estimates by R4.7 billion (3%).

• Collections were strengthened by SARS invoking Paragraph 19(3), yielding R10 billion in additional revenue, primarily from the Mining and Finance sectors.

• Despite the contribution, the mining sector faced pressure due to weaker prices for palladium, iron ore, and coal, which affected overall profitability.

Pay As You Earn (PAYE)

• PAYE collections totalled R371 billion, a 9.1% year-on-year increase (R30.9 billion), exceeding printed estimates by R3.2 billion.

• Growth was driven by employment and wage expansion in the finance and community services sectors.

• The Budget 2025 decision to freeze inflationary adjustments to Personal Income Tax (PIT) brackets and rebates is expected to generate R16.7 billion in additional revenue for the year.

Notably, Two-Pot retirement system withdrawals contributed to R18.2 billion in gross withdrawals and R5.2 billion in taxable income, further strengthening PAYE inflows.

Dividend Tax and VAT Collections

• Dividend Tax collections rose sharply to R22.3 billion, a 31% increase, buoyed by a once-off R1.4 billion payment and robust growth in the finance, manufacturing, and retail sectors.

• Domestic VAT collections climbed to R292.7 billion, up 7.8% (R21.1 billion) from the prior year, surpassing expectations by R5.2 billion (1.8%).

• Sectors contributing most to VAT growth included finance, retail, and manufacturing, partially offset by weakness in transport.

Import VAT and Refund Management

• Import VAT underperformed by R3.7 billion, reflecting sluggish growth in imports (1.2% vs an expected 5.4%).

• VAT refund payments remained steady at R183.9 billion, up marginally by 0.1%, as SARS’s intensified fraud prevention measures curbed impermissible refund claims.

“Refund risk management contributed most significantly to the solid improvement in overall Net VAT revenue,” SARS stated.

General Fuel Levy

• General Fuel Levy collections reached R44.7 billion, an increase of R2.1 billion (5%) year-on-year and surpassing estimates by R2.3 billion (5.3%).

• Fuel declarations for April–September 2025 grew 2.1% in volume, supported by strong imports (+133.1%) that offset reduced local production (–39%).

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Balancing Surpluses and Shortfalls

Despite the robust overall performance, some categories lagged expectations:

• PIT Provisional Taxes, PIT Assessments, and Customs duties underperformed.

• PIT Refunds grew to R32.2 billion, up 16.2% (R4.5 billion) from the previous year, exceeding estimates by R1.4 billion.

However, SARS processed a record 7.3 million PIT returns, up from 6.6 million in the prior year, with 5.7 million auto-assessed, reflecting the agency’s digital transformation success.

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Commitment to Fiscal Integrity and Modernization

Commissioner Kieswetter reaffirmed that SARS’s mandate extends beyond tax collection — it encompasses safeguarding fiscal integrity, promoting transparency, and ensuring fair taxation.

“Our role extends beyond revenue collection; we advance national fiscal goals in the face of persistent challenges such as debt, unemployment, and inequality,” he said.

He emphasized that with around 90% of government expenditure funded by tax revenues, strong domestic resource mobilisation remains vital to reducing reliance on external borrowing.

SARS’s continued investment in data analytics, compliance enforcement, and digital service platforms has been central to improving efficiency and restoring public trust.

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Additional Funding to Strengthen Capacity

To sustain this momentum, Minister Enoch Godongwana allocated an additional R7.5 billion to SARS under the Medium-Term Expenditure Framework (2025/26–2027/28). This funding will bolster capacity in audit enforcement, customs modernisation, and technology infrastructure, aligning with South Africa’s fiscal consolidation objectives.

SARS reiterated that this investment would help expand its data-driven compliance operations, enhance cross-border trade monitoring, and ensure timely revenue mobilisation in support of national priorities.

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Towards a Stronger Fiscal Future

With R924.7 billion collected in the first half of FY 2025/26, SARS’s strong performance signals a resilient fiscal outlook for South Africa.

The revenue service remains committed to deepening taxpayer compliance, strengthening integrity systems, and leveraging technology to secure sustainable growth and fiscal stability.

“Integrity, trust, and operational excellence remain the foundation of SARS’s mission,” Kieswetter concluded. “Through collaboration with taxpayers, we can secure a prosperous and equitable South Africa.”