News | Opinion
It is a sobering thought that, in a country with such widespread poverty, the number of South Africans who are “dollar millionaires” (with net assets of more than R14.7 million) would take up more than 60% of the capacity of Ellis Park Stadium.
The South Africa Revenue Service (Sars) is turning its spotlight on those 38,400 individuals – who often utilise complex tax structures and offshore trusts to minimise their local tax obligations.
Experts say that the establishment of a dedicated unit within Sars for this class of taxpayer (the so-called high net worth individuals) is long overdue.
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Tax attorney Jean-Louis Nel said that, in 2017 when Sars started investigating these high net worth individuals, the taxpayer was able to recover an additional R184-million.
In addition to defining such people as those with assets worth more than $1 million, Sars now includes those who earn over R3 million a year.
According to Nel, irrespective of whether you earn less than one million dollars, “you might be on Sars radar.”
South Africa is the largest wealth market in Africa and is ranked 32nd largest in the world – which means we have a lot of people who have plenty of money.
This in itself is no bad thing – as long as the money has been accumulated legally and as long as all legal tax obligations have been met.
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Hard work and genuine entrepreneurship are, after all, valuable assets in a developing country like ours.
The move to set up the unit to monitor the rich should, therefore, not been seen as a way to punish certain groups of people or even to promote “socialism by stealth”.
In many parts of the world, the ultra-wealthy often pay less back to the state than do those with less. We need equity in our financial responsibilities as citizens.
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