You tax our credulity
04 July 2012 | MARTIN WILLIAMS
There’s a whiff of that sentiment growing in South Africa. Many people who think they contribute disproportionately to the tax base feel they are being marginalised.
Unavoidably there is a racial element to this. I am not suggesting, as some do, that whites pay most of the tax.
They might. But let’s follow some logic.
Last week Jacob Zuma lamented that the economy remains primarily in the hands of white males. That is not necessarily true, depending on how you define the economy, what constitutes ownership, control and so on.
Dave Steward of the FW de Klerk Foundation tried to examine the question. He concluded that white South Africans own or control 7.5% of GDP through the JSE and another 25% through their ownership of SMEs - giving them more or less 32.5% control of the economy.
Ascribing 17% to foreign interests, he gave black South Africans a total of 50% to 51% control.
This comprises 29,4% of economic activity through control of government; 8% through control of SOEs; 3.4% through the JSE and 10% through the informal and SME sectors.
Gibberish? One thing facts do not do is speak for themselves. All these figures can be manipulated to illustrate Disraeli’s aphorism about “lies, damned lies and statistics”.
But here’s a thing. If white males did own or control most of the economy, they would also be paying most of the tax.
That includes income tax, company tax, and probably VAT.
If that were the case, why would you consistently seek to alienate the goose that lays the golden egg?
If Zuma is right, and hence whites pay the most tax, they are certainly under-represented in political decisions and budget allocations.
This brings us to Finance Minister Pravin Gordhan’s exhortation that we must be honest in our tax affairs.
He went too far by adding that “we are trying to generate values in our society”. Pass the sick bag.
What values are we generating when we tolerate a spend-thrift president, who still has a corruption cloud hanging over his head? Taxpayers are supporting an expanded cabinet and a vast, boundless family.
His travel budget makes Thabo Mbeki seem like a hermit. And he sets the tone for big-spenders.
Values? You tax credulity.
And we don’t get value for the tax we pay.
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