National Treasury acting director-general Ismail Momoniat comments on the ANC proposal to tax the wealthy to pay for a basic income grant in South Africa.
The ruling African National Congress has proposed that the government introduce a basic income grant in South Africa to tackle social inequality – and it wants a wealth tax on the country’s richest to pay for it.
For something that will cost the budget tens if not hundreds of billions of rands each year, the only tax sources available are corporate income tax , personal income tax or value-added tax , he said. Of the three remaining tax pools, only two end up being viable, and even then, trying to tap into them even further has dire consequences for the country.
Momoniat said that raising PIT would result in the richest paying more – but it will not only be the rich that are affected. “It will affect everyone: teachers, artisans, all low-paying jobs. That’s where the money come from,” he said.
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