Wealth, land and property taxes mooted

The Finance Ministry has asked for a study into the introduction of an annual wealth tax as the government seeks to boost the standard of living of the black majority, says a Fin24 report. The Davis Tax Committee, which makes recommendations to the National Treasury, also requested submissions on the feasibility of a land tax and a national tax on the value of property, it said yesterday. It will take comments until 31 May  before holding hearings. The move comes two months after the government increased the top income tax bracket by four percentage points to 45% and as President Jacob Zuma called for ‘radical economic transformation’ in his final year as leader of the ruling party, notes the report. ‘The distribution of wealth in SA is highly unequal,’ the committee, led by Judge Dennis Davis, said. ‘It is well established that economic inequality inhibits economic growth and undermines social, economic and political stability.’ SA currently has estate duty, transfer duty and a donations tax, while capital gains tax is viewed as a tax on income rather than wealth, the committee said. The study was requested by former Finance Minister Pravin Gordhan, Davis said.

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