Wealth is relative, writes Chris Hattingh, so it is enabling wealth creation and ending destitution we should be looking at
08 May 2020 - 05:05“I just don’t have time for ideological conversations at the moment,” said finance minister Tito Mboweni in a recent conference call with clients of the Goldman Sachs Group. Many South Africans share the minister’s frustration. However, ideology and ideas are vital — they determine the success or failure of a country.
The purported aim of the newest iteration of the wealth tax is to place the burden of funding government programmes , on the wealthier individuals in society. That some have accumulated more wealth does not justify the state taking more of that wealth to paper over its own destructive policies and misuse of resources.
Wealth-tax advocates devote much focus to inequality. Inequality is not the inherently immoral concept many make it out to be. If inequality comes about through free engagement and trading value for value it cannot be considered problematic. If inequality comes about through force or fraud, for example in socialist societies where governments control large parts of the economy for the benefit of a few well-connected elites, it should be considered immoral.
SA’s focus must shift from inequality to destitution. Millions of South Africans are destitute. They cannot lift themselves and their families out of poverty because the government continues to implement failed socialist policies that strangle and artificially restrict the more productive sectors of the economy — and make it nearly impossible for people to break into markets and find jobs.
For the government to have more room to spend the tax revenue it has collected , there should be a significant reduction in how much officials, ministers, and MPs are paid. As many taxpayers are currently struggling greatly, such a move would be most welcome, and indicate that those in the government take seriously the taxes with which many South Africans struggle but continue to pay.Before Covid-19, SA was operating under home-grown and global constraints.
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