{"id":161985,"date":"2017-03-05T19:00:32","date_gmt":"2017-03-05T17:00:32","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=161985"},"modified":"2017-03-05T17:38:02","modified_gmt":"2017-03-05T15:38:02","slug":"south-africas-wealthy-are-escaping-the-tax-net-report","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/161985\/south-africas-wealthy-are-escaping-the-tax-net-report\/","title":{"rendered":"South Africa’s wealthy are escaping the tax net – report"},"content":{"rendered":"

Local tax experts say that wealthy South Africans are escaping the tax net amid a collapse in the South African Revenue Service’s (SARS) enforcement division.<\/p>\n

This is according to a report in the City Press<\/a>, citing Judge Dennis Davis, chair of the Davis Tax Committee, and former SARS adviser, Yolisa Pikie, who it noted was part of a purge at the tax group.<\/p>\n

Both men were speaking at a conference on tax evasion and illicit financial flows organised by the Alternative Information Development Centre, a nongovernmental organisation, in Cape Town this week.<\/p>\n

Davis told delegates that the latest tax tables, published in the Budget Review, \u201cmake no sense\u201d.<\/p>\n

City Press reported that approximately 103,000 people would fall into a new top wealthy tax category, citing Treasury.<\/p>\n

\u201cThat makes no sense to me. There have to be more … I know more people on the Johannesburg Bar earning R5 million a year than the tax tables show,\u201d said Davis.<\/p>\n

He said that affluent individuals are eluding the tax net. Pikie pinpointed the loss of expertise at the tax body.<\/p>\n

\u201cWhat is not well known is that 80% of all corporate income tax comes from only about 400 companies,\u201d said Pikie.<\/p>\n

\u201cThe enforcement division has collapsed and some of us have been kicked to the kerb,\u201d he said, as reported by City Press.<\/p>\n

Davis told delegates that while the revenue is down by R14 billion on personal income tax, it was not because of a slow economy as was suggested by SARS commissioner Tom Moyane, as corporate tax increased by R6.5 billion. “Tell me how that happens,” the tax expert said.<\/p>\n

The country\u2019s tax tables were updated following the announcement of new tax changes for the 2017\/18 financial year in February, by finance minister Pravin Gordhan.<\/p>\n

One of the biggest changes announced by the finance minister was the introduction of a new tax bracket, aimed at the country\u2019s wealthy.<\/p>\n

South Africans who earn more than R1.5 million a year will form part of a new tax bracket which\u00a0will be taxed at 45%.<\/p>\n

Together these changes are expected to raise and additional R16.5 billion in tax revenue, which will cover a large bulk of the R28 billion shortfall.<\/p>\n

This is how the new tax tables look:<\/p>\n

\n
\n\n\n\n\n\n\n\n\n\n
Taxable income<\/th>\nTax rate<\/th>\n<\/tr>\n
Under R189 880<\/td>\n18% of taxable income<\/td>\n<\/tr>\n
R189 881 \u2013 R296 540<\/td>\nR34 178 + 26% of taxable income above R189 880<\/td>\n<\/tr>\n
R296 541 \u2013 R410 460<\/td>\nR61 910 + 31% of taxable income above R296 540<\/td>\n<\/tr>\n
R410 461 \u2013 R555 600<\/td>\nR97 225 + 36% of taxable income above R410 460<\/td>\n<\/tr>\n
R555 601 \u2013 R708 310<\/td>\nR149 475 + 39% of taxable income above R555 600<\/td>\n<\/tr>\n
R708 311 \u2013 R1 500 000<\/td>\nR209 032 + 41% of taxable income above R708 310<\/td>\n<\/tr>\n
R1 500 001 and above<\/td>\nR533 625 + 45%\u00a0 of taxable income above R1 500 000<\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n<\/div>\n
\n

Read: New tax tables for 2017: this is how much you will pay<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Local tax experts say that wealthy South Africans are escaping the tax net amid a collapse in the South African Revenue Service’s (SARS) enforcement division.<\/p>\n","protected":false},"author":10,"featured_media":87780,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872,11121],"tags":[26],"class_list":["post-161985","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-finance","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/161985","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=161985"}],"version-history":[{"count":7,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/161985\/revisions"}],"predecessor-version":[{"id":162003,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/161985\/revisions\/162003"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/87780"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=161985"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=161985"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=161985"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}