After the Bell: Why wealth redistribution through taxation is our lifeline

Daily Maverick

2 days ago

If the flow of tax money stops, we are doomed. It is money that pays for social grants, for schools, for the school nutrition programme, for antiretrovirals, for electricity for so many people.
Whenever I am feeling very worried about our country, whenever something happens that makes me really fear for our future, there is a fact I sort of cling to. One of those steadfast dynamics that really means so much.
It is that despite everything, and all of our arguments about inequality and poverty daily, richer people give a huge amount of what they earn to poorer people.
And we do this through tax.
Considering how often we grumble and gripe about the government, it is almost a miracle.
But an absolutely vital one.
If this flow of money stops, we are doomed. It is money that pays for social grants, for schools, for the school nutrition programme, for antiretrovirals (ARVs), for electricity for so many people.
It is also this flow of money that gives us each a huge stake in our society.
I remember writing during the pandemic that one of the selfish reasons I would support a basic income grant is that it would help me sleep more easily at night.
I worry a little that this flow of money is coming under a little strain.
For a long time people in the government have wasted money, and wasted it big time. And so many others have just stolen it.
Earlier today, it was confirmed that Brian Molefe, Anoj Singh and Siyabonga Gama have finally been arrested for their role in a locomotive contract at Transnet.
When we realise the damage that has been caused at Transnet, and how it is still having an impact on us now, we must look at these three as a big part of the cause.
Mind-blowing
And some of the facts that we already know about them are mind-blowing.
I mean, Singh was working as the finance director at Transnet for two years. During all of that time, he did not access his salary once.
Being finance director at Transnet is one of the big jobs in this country; it must require long hours and intense effort. I'm talking about weekend meetings, hours spent trying to sort out the finances.
And you don't access what you get paid for it once? Seriously?
To my mind, just that fact alone proves he must be guilty of corruption. What else was he living on?
But the real surprise in this story is that we are surprised.
So many people have been shown to have stolen government money and got away with it.
I mean Gama and Molefe are getting paid by the government right now. They're both Members of Parliament.
I'd remind you which party they represent, but I think you know already.
The examples of how people steal money just mount up. It gets to a point where, unless it is particularly crazy, you don't really notice any more.
Yesterday the Sunday Times showed how currently suspended Road Accident Fund CEO Collins Letsoalo has spent R10-million on security. He had more guards than anyone apart from the president and the deputy president.
Seriously, who does he think he is? Zunaid Moti?
In Joburg, a city with a budget of at least R83-billion, it seems the possibilities for wastage and corruption are literally endless.
It appears that the bosses at City Power have been finding jobs for their relatives despite the fact it doesn't have enough money to pay Eskom the full amount it owes.
Arguments about tax
I worry that arguments about tax are about to get a little more heated.
SA Revenue Service (Sars) Commissioner Edward Kieswetter made important waves when he said that there was no need to raise VAT by 2 percentage points earlier this year. Instead, he claimed that, with a bit more money, he would be able to increase the tax take by R800-billion.
That's a huge amount of money. An unbelievable amount of money.
To do this, Sars is going to get a lot tougher; it will be going after more people and investigating cases more thoroughly.
I think we'll start to hear about more disputes soon.
I suspect that more often we are going to hear people who owe Sars money complaining, not about the technical and legal aspects upon which tax depends, but about a broader principle.
They're going to say that their money is not going to social grants and school nutrition programmes and ARVs.
They're going to say, a lot more loudly than they do now, that the money they pay to the government is being wasted.
I hope that Molefe and Singh and Gama are brought into court soon. I think a State Capture case that gets to the point where a high-profile suspect ends up testifying under oath will really make everyone feel better.
Once we get there, we might start to see justice being done. And that might remove some of the pressure.
But money is still being wasted. And stolen. Huge amounts of it.
And I don't see that stopping for a while. DM