Finance and Economic Opportunities
Whether there are any municipalities in the province who have been flagged by the relevant institutions for not being VAT-compliant; if so, (a) which municipalities, (b) how much are owed to SARS, (c) why are they not VAT-compliant or have not paid the full VAT bill and (d) what is her Department doing to ensure that all municipalities in the province are VAT-compliant?
I am informed of the following:
The South African Revenue Service (SARS) is the authority for determining whether an entity is VAT compliant or not. Any question on VAT non-compliance should therefore be addressed to SARS.
As far as the Western Cape Government is aware, SARS has not issued any correspondence to a municipality in the Western Cape that indicates that they are non-compliant with the VAT Act (no. 89 of 1991, as amended).
However, VAT implementation is complex and there have been several queries and discussions with National Treasury (as the policy holder) and SARS (as the tax authority) on the details of how VAT should be applied in particular cases.
The Provincial Treasury has also facilitated training on VAT, including a recent 2-day online workshop delivered by SARS and National Treasury for Western Cape municipalities and departments held on 26-27 September 2023.
