What makes this imbalance even more disconcerting is the fact that those who are paying most of the personal income tax are also the ones who are paying the lion’s share of all the other types of taxes, such as VAT, company taxes, import tariffs and fuel levies. Joubert says an illuminating example is company tax which is a tax on the owners and employees of companies. The shareholders and employees of companies are individuals. The return on a company’s activities would have been due to these individuals if it did not have to be paid in company taxes. In addition, those individuals who pay most of the personal income tax are also the ones who have most of the buying power and who therefore pay the largest share of VAT and other taxes on products and services.
Despite the fact that 13,7 million people were registered for personal income tax in the 2012 tax year, only about 5,9 million had to submit tax returns. A further estimated 0,7 million were taxed without having submitted tax returns. Of the 13,7 million registered people only 6,6 million people could therefore be considered to be taxpayers at all. Furthermore 2,9 million people out of this group contributed only 4% of the total amount of personal income tax for the year. The remaining 3,7 million therefore paid about 96% of all personal income tax. Of this 3,7 million, one million only paid 6% of personal income tax. When this million is deducted from the total, only 2,7 million taxpayers remain, who were responsible for about 90% of all personal income tax. When this group of 2,7 million taxpayers is reduced one last time by excluding those who had a taxable income of R140 000 to R200 000, only 1,7 million people remain, who were responsible for about 80% of all personal income tax that was paid.
