The tax per citizen and average tax-to-GDP ratio in South Africa have seen a significant increase over the last thirty years, showcasing how the country has a much higher tax burden than most African countries and international standards, reports Cape {town} Etc.
This is according to South Africa’s latest tax statistics, which were released by the National Treasury and the South African Revenue Service (SARS) on Tuesday, 10 December.
According to the report, tax collections have increased from R113.8 billion in 1994/95 to R1 740.9 billion in 2023/24.
In 1995, South Africa’s population was around 44 million, which would equate to R2 586 of tax collected per citizen, as reported by The Daily Investor.
When adjusted for inflation, this would mean that the South African government collected R12 836 per person.
Currently, South Africa has a population of 63 million with the government collecting R1.74 trillion in taxes, meaning that the government collected R27 633 in taxes per citizen.
This is more than double the average, in thirty years.
New taxes and increased existing tax rates have been introduced by the state, in addition to collecting more taxes from more people.
The rise in taxes has also been illustrated in tax revenue as a percentage of GDP, as the tax-to-GDP ratio measures the tax burden for a given period.
A higher tax-to-GDP ratio would indicate that a country has higher taxes relative to its economic output, while a lower ratio would indicate that tax burdens are lighter.
While the median tax-to-GDP ratio is around 22% globally, South Africa’s 2023/24 ratio stands at 24.5%. This is a sharp increase from South Africa in 1994/95, when the tax revenue was 20.2% of GDP.
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