Eight South African taxpayers paid SARS R90 billion

Eight major South African banks contributed R90.45 billion in taxes and tax-related payments in 2024, representing nearly 5% of government revenue and 1.24% of GDP.

PwC, in collaboration with The Banking Association South Africa (BASA) and eight major South African banks, recently conducted the 2024 Total Tax Contribution (TTC) study.

This study, which was done using PwC’s internationally recognised TTC Framework, provides a transparent and data-driven view of the banking sector’s fiscal footprint.

The analysis revealed that South African banks are among the most significant contributors to national revenue, reflecting not only the scale of their corporate income tax but also the wider network of employment, consumption, property, and regulatory taxes.

PwC said the study marks an important milestone in strengthening transparency and reinforcing the sector’s commitment to South Africa’s social and economic development.

“South Africa’s banking sector is a foundation of fiscal resilience,” said PwC South Africa’s associate director of tax reporting and governance, Carla Perry.

The local banking sector also provides a stable tax base and serves as a critical intermediary in the flow of taxes to the government.

The study revealed that eight participating banks contributed a total of R90.45 billion in TTC for the 2024 fiscal year.

This amount represents a significant 4.88% of the government’s total tax receipts and 1.24% of South Africa’s national GDP.

This significant fiscal contribution comes from eight participating banks collectively representing almost two‑thirds of the financial services sector on the JSE.

Of the R90.45 billion total, R33.66 billion (37.21%) represents taxes borne, direct costs to the banks, including corporate income tax, skills development levies, and irrecoverable value-added tax (VAT).

However, banks are not just taxpayers, as they also serve as one of the tax system’s most efficient collection agents. According to PwC, the banks included in the study collected R56.79 billion (62.79%) in taxes on behalf of the government.

They collected R33.23 billion in people taxes, with PAYE accounting for almost all of it, and remitted R12.47 billion in VAT.

They processed R1.50 billion in Securities Transfer Tax (STT), which represents 25.18% of all government STT revenue.

They also administered R9.59 billion in dividends withholding tax, amounting to 22.25% of national Dividends Tax collections.

Beyond taxes, the participating banks made a further R3.40 billion in non-tax payments to the government in the 2024 financial year, supporting regulatory oversight, financial system stability, and depositor protection.

All of this comes at a cost, PwC said, and the cost of tax compliance in South Africa’s banking sector is substantial and rising.

The cost of compliance

In 2024, the eight participating banks incurred R589.3 million in compliance costs – equivalent to 0.65% of the sector’s TTC.

Tax compliance remains heavily people‑driven. Across the eight banks, compliance activities consumed 503,309 hours in 2024.

This is the equivalent of 242 full‑time employees working exclusively on tax‑related tasks. Internal staffing accounts for 61% of all compliance costs.

On top of that, the banks absorbed R74.8 million in additional costs for uncompensated administrative work required under SARS’ third‑party appointment (TPA) regime.

A hidden compliance cost means that for every R100 banks collect through TPAs, they spend an additional R1.39. When taxes administered through TPAs are included, the sector’s total fiscal footprint rises to R95.85 billion.

However, these costs remain invisible, absorbed within existing staff duties rather than tracked as dedicated functions.

“PwC is proud to collaborate with BASA and the participating banks to deliver this assessment,” Perry said.

“We trust that the findings provide context to policymakers, investors, revenue authorities, and other stakeholders, not only on how much taxes banks pay, but also how the sector drives economic value beyond the taxes.”

BASA’s direct tax committee chairperson, Mardelle Kelbrick, said the association welcomes this TTC study and the transparency it brings to an important conversation.

“The findings provide a clearer picture of the banking sector’s full contribution to the South African economy,” Kelbrick said.