IRR warns of tax revolt in wake of budget speech 

24 February 2021

What the budget reveals is the extent to which the government is making South Africans pay through taxation for the consequences of corruption and expropriation policy.

The tax-to-GDP ratio is now the highest in South Africa’s history and is causing considerable trauma across households struggling to afford goods and services ranging from their bond payments to their children’s school fees.

Despite that burden the deficit is on a par with depths reached on only three previous occasions – the two World Wars and the aftermath of the Rubicon speech in 1985 as the apartheid economy collapsed under the weight of its contradictions.

Dr Frans Cronje, CEO of the Institute of Race Relations (IRR), warned: “If it carries on like this, the government risks triggering a tax revolt that will see South Africans, where possible, redirect their taxes to bypass the state.

This is, in fact, already beginning to happen.

“It is unsustainable to think that taxpayers will continue to put up with a government whose policies hound investment out of the country and then go on to loot what revenues remain while taking little action to bring the corrupt to book.

“Our very strong sense is that communities and businesses will look to provide their own services and many effective and legal avenues to do this exist. Should the government clamp down on such avenues the effect will be to hound those taxpayers out of the country.”

Issued by Hermann Pretorius, IRR Head of Strategic Initiatives, 24 February 2021