Finance Minister Pravin Gordhan has appointed retired Gauteng Judge President Bernard Ngoepe as the Tax Ombud, but taxpayers will probably have to wait a few months before they can start approaching the ombud with complaints.
A National Treasury spokesperson says that further details about the office, including when it will begin accepting cases, will be announced by the ombud in the next two weeks.
The Tax Ombud was established in terms of the Tax Administration Act, which became effective on October 1 last year. It gave the minister a year to appoint the ombud.
The office is intended to provide you, the taxpayer, with a low-cost mechanism to address administrative problems that you are unable to resolve with the South African Revenue Service (SARS).
The Tax Ombud’s office is independent in that it reports to the Minister of Finance, but it is empowered to use SARS employees to ensure that the staff are knowledgeable about tax and SARS’s internal processes. The office will share SARS’s facilities and structures to reduce the costs of running the office, Stiaan Klue, the chief executive of the South African Institute of Tax Practitioners (Sait), says.
A statement issued by the Finance Ministry says Judge Ngoepe has sound experience in exercising impartiality, and an understanding of how best to balance the powers and duties of SARS and the rights and obligations of taxpayers. Above all, he is proficient in tax and administrative law, it says.
Judge Ngoepe was an acting judge of the Constitutional Court and he is the Chancellor of the University of South Africa. He also served on the Truth and Reconciliation Commission’s Amnesty Committee.
Mike Dingley, national tax director of global audit, tax and advisory firm Mazars, says a person of Judge Ngoepe’s stature and standing will command respect from SARS and taxpayers alike.
Dingley says the problem with the Tax Ombud, however, is that his powers are limited.
He and Klue say you will be able to turn to the ombud if you have a legitimate complaint about administrative matters, poor service or the failure by SARS to observe your rights, and you have exhausted complaints processes and channels at SARS.
Dingley says the ombud may not review legislation, policy, generally prevailing practice, nor matters subject to objection and appeal except to the extent they relate to service, procedure or administration. He also may not review pending matters or decisions of the tax court, he says.
Klue says that where there is disagreement on the interpretation of the law, you will have to follow other steps to resolve your dispute – usually by lodging an appeal to either the tax board or the tax court, with the option of lodging further appeals to higher courts if justified.
Dingley says matters taken to the Tax Ombud must be resolved through mediation or conciliation.
He says the ombud must identify and review systemic issues relating to service, procedure or administration that impact negatively on taxpayers and report quarterly to the Commissioner of SARS and annually to the minister. The annual report to the minister must be tabled in the National Assembly.
Klue says the ombud’s rulings are not binding on either SARS or the taxpayer, but if SARS actively engages with and monitors the ombud’s findings, the non-binding nature of the rulings should be academic.