TAX freedom day this year in South Africa, falling on Thursday, comes four days later than last year and almost a month later than in 1993, when it was on April 13, says Garth Zietsman, statistician at the Free Market Foundation. <\/p>\n
It points to the day when South Africans stop paying their tax obligations to the government and enough wealth has been produced to meet the countrys tax burden. <\/p>\n
The foundation predicts that tax freedom day will be even later next year given government spending, the deficit and rising government debt. <\/p>\n
Mr Zietsman said on Wednesday that the only way for the government to fund its spending was to raise taxes. <\/p>\n
Tax as a percentage of South Africas gross domestic product (GDP) has increased from 24.4% in the 2009-10 tax year to 24.6% the following year and 25% in 2011-12. It is estimated at 25.5% in the current tax year. <\/p>\n
South Africans achieved tax freedom on April 12 in 1994, on April 20 in 1999 and on April 24 in 2000. <\/p>\n
\"Studies consistently show that when government spending consumes more of total earnings, investment and growth rates drop and unemployment increases,\" said Mr Zietsman. <\/p>\n
\"Higher taxes result in less disposable income; less disposable income means less saving; less saving means less capital formation; less capital formation means lower labour productivity; and lower labour productivity means lower real wages.\" <\/p>\n
He added the government was growing at such an alarming pace that it was using tax money for consumption spending rather than for core functions and capital projects. <\/p>\n
Stiaan Klue, CEO of the South African Institute of Tax Practitioners, said the real test was not how long it took to pay ones share of taxes, but the value one got for it. He said even though taxpayers in developed countries such as Belgium might work eight months before reaching tax freedom day, one had to consider how their taxes were working from them. <\/p>\n
<\/p>\n
Visit link: <\/p>\n
SA takes longer to achieve tax freedom day<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" TAX freedom day this year in South Africa, falling on Thursday, comes four days later than last year and almost a month later than in 1993, when it was on April 13, says Garth Zietsman, statistician at the Free Market Foundation. It points to the day when South Africans stop paying their tax obligations to the government and enough wealth has been produced to meet the countrys tax burden. The foundation predicts that tax freedom day will be even later next year given government spending, the deficit and rising government debt Continue reading