2014: 100 years of income tax in South Africa
Income tax in South Africa is 100 years old this year. It was instituted on a limited scale in 1914, but during the past 100 years it has expanded tremendously, to such an extent that it today affects the entire middle class, the Solidarity Research Institute (SRI) said today.
Income tax is typically seen as an inevitable part of modern society. Many people think that this kind of tax has always been with us. This is not the case. Income tax is a relatively new kind of tax in South Africa; and does not date back much more than four generations.
Modern Western income tax originated in Britain 1799 as a temporary levy only to fund the Napoleonic wars. Income tax was abolished in 1815 but was reinstated in 1842.
Almost 200 years after the introduction of income tax, it was still deemed a temporary tax in Britain requiring annual new legislation to maintain it.
In 1914, the first national income tax was instituted in the Union of South Africa through the Income Tax Act of 1914. Before the introduction of income tax, state revenue mainly came from trade levies, user fees, indirect taxes and mine taxes.