Ahead of 2017’s medium-term budget policy statement (MTBPS), then finance minister Malusi Gigaba cited concerns around the weakening tax compliance and tax morality in South Africa.
This has lead to some economists questioning the possibility of a tax revolt in the country.
A tax revolt refers to a case where taxpayers refuse to pay taxes to send a message to government – either to show opposition to a form of tax (or tax increases) or as opposition to government policy.
Speaking to BusinessTech, tax manager at Mazars, Tertius Troost, noted that while a tax revolt will always be a concern, it would be very difficult to implement in South Africa.
“SARS has many methods to collect tax revenue and the refusal by taxpayers to pay tax will not necessarily result in that taxpayer not paying the tax,” Troost said.
“The Tax Administration Act can levy penalties on non-compliant taxpayers and if the taxes remain outstanding, SARS may apply for a court order to have the outstanding taxes collected on its behalf by a third party (e.g. the taxpayer’s bank).”
He added that a large amount of tax revenue is also collected from so-called indirect taxes (i.e. VAT, fuel levy, etc.).
The only way to not pay these taxes is to not purchase the products on which these taxes are levied, and not purchasing groceries and fuel will be difficult, Troost said.
“My view has always been that a tax revolt will be very difficult to implement by the South African public.
“However, the taxpayers might rather revolt in the form of emigration,” he said.
“The unhappier the South African taxpayers become the more they will contemplate leaving the country.”