Piet le Roux: We are running out of patience with tax
Wednesday, March 26th, 2014
Taxpayers have been sceptical about tax in South Africa for a long time. Thus far the main reason for this has been the realisation that a lot of the money is wasted and is not used in the public interest. Nowadays, however, more and more people are wondering to what extent our tax money is being used against us and to the public detriment.
In the first instance there are relatively few taxpayers. In the previous tax year 80% of all personal income tax was paid by only 1,7 million people. This translates into 5,7% of the 30 million people in the age group between 20 and 64 years. Why should this small elite band keep on paying?
The answer, apparently, is quite simple: If you don’t pay, the tax man will get you. Julius Malema is a recent example.
A more heroic historical example is David Henry Thoreau, the influential American writer, who in the 19th century refused to pay tax because it would help finance government policy on the continuation of slavery and an opportunistic war. Thoreau went to jail until somebody paid his taxes on his behalf, but against his wishes.
Most taxpayers are quite willing to pay taxes. They realise that their money is needed for financing things that are in the public interest – such as roads, schools and a social safety net.
Taxpayers in general therefore pay up under the impression that paying is the right thing to do, as in the case of TV licences. They would like to see something in return but do not demand that all tax money must be used to their personal advantage.
This brings us to the first reason why taxpayers are becoming sceptical about tax: Their money is not serving the public interests but vanishes into projects such as a presidential palace, BMWs and money sinks like the South African Airways.
The second reason, even if not quite of the same order as the first, is that more and more taxpayers are beginning to realise that their tax money is being actively used against them and to the public detriment. Just think of Lt. Col. Renate Barnard, the police member whose case against the unfair application of affirmative action will soon be tested in the Constitutional Court – at last, after nine years of court battles. Unfair affirmative action is being kept in place at the taxpayer’s expense without taking into account that it would be in the public interest to allow a diligent officer such as Barnard to advance in her career.
So far the state has already had to spend more than R5,2 million to defend its unlawful and unfair application of affirmative action.
However, the problem goes beyond malicious litigation. It includes the state’s efforts to get bigger state control over universities and schools at taxpayers’ expense; how harmful legislation is being devised; and how cadre deployment is ripping the heart out of local authorities. It also includes the growing but unsustainable welfare state, which obstructs the development of a culture of self-reliance in South Africa.
People no longer believe that paying for TV licences is the right thing to do. They see the shenanigans going on at the SABC and realise that their money is being used against them and to the public detriment.
The same sentiment is developing around tax.
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