Original Research
Investigating a new wealth tax in South Africa: Lessons from international experience
Journal of Economic and Financial Sciences | Vol 11, No 1 | a175 |
DOI: https://doi.org/10.4102/jef.v11i1.175
| © 2018 Jackie Arendse; Lilla Stack
| This work is licensed under CC Attribution 4.0
Submitted: 31 January 2018 | Published: 09 April 2018
Submitted: 31 January 2018 | Published: 09 April 2018
About the author(s)
Jackie Arendse, Department of Accounting, Faculty of Commerce, Rhodes University, South AfricaLilla Stack, Department of Accounting, Faculty of Commerce, Rhodes University, South Africa
Abstract
In recent years, there has been an increasing focus on new sources of taxation, including wealth tax. In South Africa, two phenomena have driven the focus on wealth tax. Firstly, the need for additional tax revenue to fund an ongoing and growing budget deficit, exacerbated by a prolonged period of low economic growth, rising government debt and a very small base of individual taxpayers. Secondly, the fact that South Africa has one of the most unequal societies in the world. The dual demands of increased tax revenue and economic inequality have converged around wealth tax as a possible panacea to both problems. Although South Africa has a long history of wealth transfer tax in the form of estate duty and donations tax, there has never been a tax on the net wealth holdings of individuals during their lifetime. Internationally, numerous countries have used wealth tax in various forms, including inheritance tax, gift tax, recurrent wealth tax and non-recurrent wealth tax. This study examines some of the international experiences with these three categories of wealth tax, seeking lessons and experiences that can inform the debate around the viability of a new wealth tax in South Africa.
Keywords
taxation; wealth taxes; international taxes; individual tax; inequality; tax revenue
Metrics
Total abstract views: 5143Total article views: 12230
Crossref Citations
1. Fiscal expenditures, revenues and labour productivity in South Africa
Andrew Phiri, Chuma Mbaleki, Christian Nsiah
Cogent Economics & Finance vol: 10 issue: 1 year: 2022
doi: 10.1080/23322039.2022.2062912