How do you get a prostitute to pay tax on the money she makes? Well, it’s actually not as difficult as it seems. While the rest of us (actually we’re a very small percentage) are being screwed by the taxman she (or he) is doing it the other way round.*
And that bloke selling illegal fags on the street corner? I bet he’s not paying any tax either.
In fact, just about everybody dealing in cash probably “forgets” to mention most of their income.
And I’m not giving into temptation by starting a rant about those bastards who make a fortune out of showing people how to avoid paying tax. What I will say is that they should all be locked in a room with Jeremy Clarkson and forced to listen to him speak his mindless drivel endlessly for 24 hours a day.
South Africa relies far too much on the few of us who DO pay. They may be trying to expand the number but that idea will also fail – because income tax is so easy to avoid. The numbers vary but, essentially, out of around 18 million people who work only about five million pay income tax.
Even if this gap were closed significantly it’s an inherently bad idea for any government to promise a wealthy country in exchange for increasing amounts of taxation on income.
As Winston Churchill famously said: “A nation trying to tax itself into prosperity is rather like a man standing in a bucket and trying to lift himself up by the bucket handle.”
But the solution is SO simple that I’m amazed it hasn’t been done before.
So, for all those politicians reading this (I know you do because Brewers Droop has been mentioned in Parliamentary debates before) just repeat the following words several times a day until the idea finally sinks in.
Abolish ALL earning tax (PAYE) and increase spending tax (VAT).
Then EVERY person will be paying tax to the government and its coffers will fill very quickly. The reason is simple – it’s a million times more difficult to fiddle VAT than PAYE.
Of course some items will be zero rated (like bread) but VAT on a new Merc will be 100% (and car dealers mustn’t worry because sales will go up! A high-earning person not paying income tax will have loads of cash to spare).
You don’t have to thank or reward me, it’s my gift to all mankind.
[* Actually there have been many cases of prostitutes being forced to pay income tax despite their earnings being illegal. In America even an embezzler was ordered to pay tax on the money he’d stolen!]
YOU GOT TO KNOW WHEN TO FOLD EM
It seems to have been rather a rough time lately for some of the businesses which our government controls – specifically SAA and the SABC.
At the time of writing Carol Carolus (chairwoman of SAA) and seven other board members resigned – putting our national carrier at even greater risk.
Meanwhile Public Enterprises Minister Malusi Gigaba expressed, through a spokesman, some “surprise” at what had happened, adding that the Company Secretary had not yet received their resignations in writing. Well, he was just waiting for the postman first and then planned to deal with the crisis later I expect.
But he did move rather quickly when the story broke. He appointed an acting chairman in the meantime while announcing Vuyisile Kona will be the new chairman. (In fact he reacted SO quickly – almost indecently fast – that I hope he gave enough thought to the matter). Although I suppose it doesn’t really matter who’s going to continue this monumental cock up.
And following on from what I said in the last Droop (#197) the 2011 financial results for SA Express (another government initiative) have been delayed until next year because of “accounting errors”, which is hardly surprising since that’s happened every year since 2008. Sigh.
By the way…SAA has also invited proposals from “suitably qualified service providers” to tender for ‘Global Advertising Services’ – that should get some interest going amongst a few agencies I would think. If you’d like a copy of it then email me and I’ll send it to you.
ANOTHER NATIONAL DISASTER
Meanwhile, on the other side of Johannesburg, the knives are out (again) in the SABC boardroom. Directors are running around the corridors shouting “corruption” and accusing each other of dysfunctionality.
Allegations regarding corruption and maladministration surround chairman Ben Ngubane (who has been described as having an ‘abrasive’ character).
Chief financial officer Gugu Duda has already been suspended over allegations of irregular procurement procedures.
Now they want to get rid of Cawekazi Mahlati because she’s apparently been suspected of doing something naughty too – although she says it’s all just a cover-up to hide evidence of corruption (someone else’s).
In both the cases of SAA and the SABC the respective histories of both businesses are surely sufficient evidence to prove once and for all that government should NOT be involved with big business.
In the meantime it seems that watching e.tv and flying BA are some serious options. But as Chris Moerdyk so eloquently phrased it, those of us who pay tax are actually paying to watch SABC and fly SAA whether we like it or not. (Which is why the hooker and the man selling illegal cigarettes are smiling – they’re so much smarter than we are.)
Oh well, it’ll soon be Christmas when we can all be jolly again and pretend we have a corruption-free society. (Mind you, it’s taking increasingly more merlot to get me thinking like that these days).
This post is published with the kind permission of Chris Brewer.