South Africa’s tax authority is transferring to subject each taxpayer with a singular digital identification beneath a significant overhaul that blends biometrics, synthetic intelligence, and prompt funds right into a single compliance system.
The South African Income Service (SARS) has launched “Modernisation 3.0,” a programme that can consolidate taxpayer data into one authenticated profile secured by biometric and two-factor verification (2FA). The system is designed to present people and representatives a single view of their tax affairs, permitting them to replace particulars, verify accounts, and make funds with out interacting instantly with the company.
The shift comes as SARS reported a document R2.01 trillion ($119.2 billion) in web income for the 2025/26 monetary 12 months, its first time crossing the R2 trillion ($119 billion) mark. The determine displays robust development in collections and alerts the size of the tax base the company is now in search of to handle via automation.
Modernisation 3.0 additionally expands SARS’s use of synthetic intelligence. The company plans to deploy programs it describes as “agentic AI” to automate routine compliance work, analyse massive datasets, and flag dangers for investigation. These instruments may also assist a broader push towards voluntary compliance by decreasing guide processes.
A key element of the overhaul is a brand new prompt fee system being developed with the South African Reserve Financial institution (SARB), the nation’s central financial institution. The system goals to hurry up tax funds and cut back reliance on cash-based transactions, aligning with broader efforts to digitise the nation’s funds infrastructure.
SARS mentioned the programme may also lengthen to value-added tax (VAT) assessments and customs processes, together with a transfer towards automated VAT returns and a “no-stop border publish” mannequin for commerce flows.
Edward Kieswetter, the company’s commissioner, mentioned the course of the programme displays a system the place “tax simply occurs,” constructing on current auto-assessment instruments that already course of thousands and thousands of taxpayers with out guide intervention.
The company estimates it prevented about R75 billion ($4.5 billion) in income leakage up to now 12 months via data-driven enforcement and compliance work.
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