An investigation into the introduction of a new wealth tax in South Africa
- Authors: Arendse, Jacqueline A
- Date: 2018
- Subjects: Wealth tax -- Law and legislation -- South Africa , Taxation -- Law and legislation -- South Africa , Income tax -- South Africa , Fiscal policy -- South Africa , South Africa -- Economic conditions , Income distribution -- South Africa
- Language: English
- Type: text , Thesis , Doctoral , PhD
- Identifier: http://hdl.handle.net/10962/61379 , vital:28020
- Description: In a world of economic uncertainty and manifold social problems, South Africa has its own unique challenges of low economic growth, persistent budget deficits that produce increasing government debt and the highest level of economic inequality in the world. The history of injustice and economic marginalisation and the failure of the economy to provide inclusive growth drives an urgent need to address economic inequality through tax policy, placing ever more focus on wealth taxes as a possible solution. There is a hope is that taxing the wealthy may provide the opportunity to redistribute desperately-needed resources to those denied the opportunity to build wealth and who are trapped in the cycle of poverty. Yet, as appealing as a new wealth tax may seem, the introduction of such a tax carries with it a range of risks, not all of which are known. Of great concern is the possible effect on the economy, which, in its vulnerable state, cannot afford any loss of capital and investment. Very little research has been done on wealth tax in the South African context and there is a dearth of literature focusing on the views and perceptions of the wealthy individuals themselves. This qualitative study investigates the merits and disadvantages of a new wealth tax and seeks to identify any unintended consequences that could result from the implementation of a new wealth tax in South Africa, drawing from historical and international experience and primary data obtained from interviews with individuals likely to be affected by such a tax. Having explored the literature and international experiences with wealth tax and having probed the thinking of wealthy individuals who would be the payers of a wealth tax, the study finds that a new wealth tax may contribute towards the progressivity of the tax system, but it is doubtful whether such a tax would provide a sustainable revenue stream that would be sufficient to address economic inequality and there is a risk of causing harm to the economy. Recognising that the motivation for wealth taxes is often driven more by political argument and public perception than by rational quantitative analysis, the study also anticipates the introduction of a new wealth tax and suggests guidelines for the design of such a tax within the framework for evaluating a good tax system. This study informs the debate on wealth taxes in South Africa and contributes to the design of such a tax, should it be implemented.
- Full Text:
- Date Issued: 2018
- Authors: Arendse, Jacqueline A
- Date: 2018
- Subjects: Wealth tax -- Law and legislation -- South Africa , Taxation -- Law and legislation -- South Africa , Income tax -- South Africa , Fiscal policy -- South Africa , South Africa -- Economic conditions , Income distribution -- South Africa
- Language: English
- Type: text , Thesis , Doctoral , PhD
- Identifier: http://hdl.handle.net/10962/61379 , vital:28020
- Description: In a world of economic uncertainty and manifold social problems, South Africa has its own unique challenges of low economic growth, persistent budget deficits that produce increasing government debt and the highest level of economic inequality in the world. The history of injustice and economic marginalisation and the failure of the economy to provide inclusive growth drives an urgent need to address economic inequality through tax policy, placing ever more focus on wealth taxes as a possible solution. There is a hope is that taxing the wealthy may provide the opportunity to redistribute desperately-needed resources to those denied the opportunity to build wealth and who are trapped in the cycle of poverty. Yet, as appealing as a new wealth tax may seem, the introduction of such a tax carries with it a range of risks, not all of which are known. Of great concern is the possible effect on the economy, which, in its vulnerable state, cannot afford any loss of capital and investment. Very little research has been done on wealth tax in the South African context and there is a dearth of literature focusing on the views and perceptions of the wealthy individuals themselves. This qualitative study investigates the merits and disadvantages of a new wealth tax and seeks to identify any unintended consequences that could result from the implementation of a new wealth tax in South Africa, drawing from historical and international experience and primary data obtained from interviews with individuals likely to be affected by such a tax. Having explored the literature and international experiences with wealth tax and having probed the thinking of wealthy individuals who would be the payers of a wealth tax, the study finds that a new wealth tax may contribute towards the progressivity of the tax system, but it is doubtful whether such a tax would provide a sustainable revenue stream that would be sufficient to address economic inequality and there is a risk of causing harm to the economy. Recognising that the motivation for wealth taxes is often driven more by political argument and public perception than by rational quantitative analysis, the study also anticipates the introduction of a new wealth tax and suggests guidelines for the design of such a tax within the framework for evaluating a good tax system. This study informs the debate on wealth taxes in South Africa and contributes to the design of such a tax, should it be implemented.
- Full Text:
- Date Issued: 2018
Socio-economic processes in the rural areas of Region E
- Authors: May, Julian
- Date: 19--?
- Subjects: Poverty -- South Africa , Income distribution -- South Africa , Household surveys -- South Africa , Rural poor -- South Africa , South Africa -- Rural conditions
- Language: English
- Type: text , book
- Identifier: http://hdl.handle.net/10962/75421 , vital:30416
- Description: The social conditions in the rural areas of South Africa are by now widely known and numerous researchers have documented the poverty stricken quality of life which generally prevails amongst black families in these areas (Wilson and Ramphele, 1989). The vast majority of rural households have incomes which are below subsistence levels and in the Homelands, agricultural productive ability has become so eroded that rural household income is now chiefly derived from remittances from migrants in the towns or from the wages of farm labourers (Nattrass and May, 1986). As such, at present the majority of black rural households living in Region E make up consumer communities which must purchase the majority of their subsistence needs, rather than producer communities in which subsistence needs can be met from the utilisation of local resources (Derman and Poultney, 1983). Despite this unpromising situation, the diminishing importance of agricultural production to the South African national economy (Bethlehem, 1989), and the dominance of urbanisation as a social force, it can be argued that the rural areas of Region E will be directly and substantially affected by efforts to restructure the South African economy as a whole. Consequently, revitalising the rural economy in a restructured social and economic system would be a concern in itself, even though the effect of this for a future growth path for South Africa may be uncertain (Kaplinsky, 1991:54). The report will first examine the broad demographic changes in Region E noting the impact of these changes on the rural areas. Thereafter, the economic processes which characterise the rural areas will be discussed, in particular, employment, income levels and income distribution. This will feed into a discussion of the social processes which will include changing dynamics of migration, and a socio-economic profile of rural households. The paper concludes by briefly examining access and usage of basic services and facilities in the rural parts of Region E.
- Full Text:
- Date Issued: 19--?
- Authors: May, Julian
- Date: 19--?
- Subjects: Poverty -- South Africa , Income distribution -- South Africa , Household surveys -- South Africa , Rural poor -- South Africa , South Africa -- Rural conditions
- Language: English
- Type: text , book
- Identifier: http://hdl.handle.net/10962/75421 , vital:30416
- Description: The social conditions in the rural areas of South Africa are by now widely known and numerous researchers have documented the poverty stricken quality of life which generally prevails amongst black families in these areas (Wilson and Ramphele, 1989). The vast majority of rural households have incomes which are below subsistence levels and in the Homelands, agricultural productive ability has become so eroded that rural household income is now chiefly derived from remittances from migrants in the towns or from the wages of farm labourers (Nattrass and May, 1986). As such, at present the majority of black rural households living in Region E make up consumer communities which must purchase the majority of their subsistence needs, rather than producer communities in which subsistence needs can be met from the utilisation of local resources (Derman and Poultney, 1983). Despite this unpromising situation, the diminishing importance of agricultural production to the South African national economy (Bethlehem, 1989), and the dominance of urbanisation as a social force, it can be argued that the rural areas of Region E will be directly and substantially affected by efforts to restructure the South African economy as a whole. Consequently, revitalising the rural economy in a restructured social and economic system would be a concern in itself, even though the effect of this for a future growth path for South Africa may be uncertain (Kaplinsky, 1991:54). The report will first examine the broad demographic changes in Region E noting the impact of these changes on the rural areas. Thereafter, the economic processes which characterise the rural areas will be discussed, in particular, employment, income levels and income distribution. This will feed into a discussion of the social processes which will include changing dynamics of migration, and a socio-economic profile of rural households. The paper concludes by briefly examining access and usage of basic services and facilities in the rural parts of Region E.
- Full Text:
- Date Issued: 19--?
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