The South African Revenue Service has done what many thought impossible just a few years ago: it has pushed net revenue collections past the R2 trillion barrier for the first time in the country’s democratic era. For the 2025/26 financial year, SARS delivered R2.010 trillion – R24.7 billion above the revised estimate announced at Budget 2025. This is not just a number on a spreadsheet. It is breathing room for the fiscus, proof that a reimagined SARS can deliver even when the economy refuses to cooperate.
When SARS Commissioner Edward Kieswetter took office seven years ago, the organisation was still reeling from the damage exposed by the Nugent Commission. Today he leaves with a record that will be remembered for generations: R2.010 trillion in net revenue for the 2025/26 financial year. That is 8.4 percent higher than the previous year and R151.7 billion more than the year before – growth that comfortably beats the 5.4 percent nominal GDP expansion.
The numbers tell a story of quiet determination. Over the past seven years SARS has collected R11.5 trillion – almost half of everything it has raised since 1997. Compound annual growth sits at 5.8 percent, the tax-to-GDP ratio is a healthy 25.9 percent, and tax buoyancy has reached 1.70. These are not abstract ratios. They translate into schools that can open, hospitals that can buy medicine, and roads that can be fixed without sending the country deeper into debt.
How the Money Came In
Domestic VAT led the charge at R604 billion – up 7.6 percent and beating every earlier forecast. Large business vendors contributed 48.2 percent while small and medium enterprises and the finance sector made up the rest. PAYE delivered R767 billion, growing 8.5 percent thanks to modest wage increases and the fiscal drag that comes when tax brackets are not fully adjusted for inflation. Corporate income tax provisional payments reached R355.5 billion, with SMMEs actually outpacing big companies in growth rate.
Import duties and import VAT showed modest gains, driven largely by a small recovery in passenger vehicle imports. Even VAT refunds, which totalled R371.1 billion, were tightly controlled – SARS prevented an estimated R75 billion in fraudulent claims through better verification and syndicated-crime investigations.
The Human Effort Behind the Record
Commissioner Kieswetter was clear when he spoke yesterday: this was not luck. “Collecting over R2 trillion is not an accident,” he said. “It is the outcome of more than 14 500 employees who diligently perform millions of activities meticulously.” From debt collectors chasing down R110.9 billion in arrears to data scientists using AI to spot high-risk refunds, every rand collected reflects thousands of small, often invisible decisions made correctly.
Voluntary compliance efforts alone secured R316.39 billion this year – R12.4 billion more than last year. The VAT Voluntary Compliance Index edged up from 66.59 percent to 67.19 percent, a small but meaningful shift that shows ordinary taxpayers are slowly buying into the idea that paying what is due is part of building the country.
Modernisation 3.0: The Next Chapter
As he prepares to hand over, Kieswetter used the moment to unveil Modernisation 3.0. The vision is ambitious: every taxpayer will eventually have a Unique Digital Identity secured by biometrics and two-factor authentication. Taxpayers will see all their accounts in one place, update details instantly, and pay through an instant-payment system backed by the Reserve Bank. Routine work will be automated by intelligent case-management systems that use big data and agentic AI.
VAT will move toward automatic assessment. Customs will support the “no-stop border-post” concept. The goal, Kieswetter says, is a world where “the best service is no service at all” and “tax just happens” – something more than six million auto-assessed taxpayers already experienced last year.
The Shadow Economy That Still Drains the Fiscus
For all the success, the Commissioner did not sugar-coat the threats. The illicit economy – smuggling, counterfeit goods, fuel and tobacco syndicates, under-declaration – is still costing the country well over R100 billion a year. “People who buy illicit goods often believe they are getting a bargain,” Kieswetter warned. “In reality, they are funding the destruction of legitimate businesses and jobs.”
Every carton of fake cigarettes, every litre of smuggled fuel, every undeclared container at the border means fewer resources for the social contract that binds the state to its citizens. SARS, working with other law-enforcement agencies, has made disrupting these networks a priority. The message is unmistakable: non-compliance is becoming harder and more expensive.
What the Milestone Means for Ordinary South Africans
The extra R24.7 billion above estimate gave Finance Minister Enoch Godongwana the breathing space to hold the line on VAT. That single decision protects household budgets already squeezed by load-shedding, rising food prices and stagnant wages. It also means more fiscal space for infrastructure projects, social grants and the public-sector wage bill without immediately borrowing more.
From 1994/95 when SARS collected just R114 billion to today’s R2 trillion mark, the organisation has grown up with democracy. It has survived pandemics, energy crises and political turbulence. The fact that it could deliver this result while the economy grew at only 5.4 percent shows resilience that many South Africans rarely see but feel every time a hospital is built or a learner receives a textbook.
A Commissioner’s Farewell and a Nation’s Thanks
As his seven-year tenure ends, Kieswetter reflected on the President’s “Thuma Mina” call that brought him out of retirement. “I am filled with immense pride that, together with the help of the people at SARS, we have given our best to the nation,” he said. He thanked compliant taxpayers for their fiscal citizenship and saluted the 14 500 staff members who turned a damaged institution into one that can once again be trusted.
The record is real, but the work is far from finished. Modernisation 3.0 must be delivered. The illicit economy must be squeezed harder. Voluntary compliance must keep rising. Yet for one moment yesterday, South Africa could pause and recognise what has been achieved: a revenue service that has quietly become one of the most effective arms of the state at a time when the state needed it most.
R2 trillion is not the end of the story. It is proof that, even in tough times, South Africans working together inside SARS can still deliver for the country. The challenge now is to make sure every rand is spent wisely so that the next milestone feels even more earned.