VAT hike could have been avoided if corruption had been cut, Dennis Davis says
A hike in the value-added tax (VAT) rate, which kicks in at the end of March, could have been avoided, Judge Dennis Davis, chair of the Davis Tax Commission, said on Wednesday.Davis headed a committee that was appointed in 2013 to review SA’s tax policy framework. A finding from the committee was that a one percentage point increase in the VAT rate from 14% to 15% could raise R20bn in revenue.In February, the government was forced to turn to a VAT hike — the first in 23 years — to plug a nearly R50bn revenue gap.Davis, speaking at the Small Business Indaba in Bryanston, raised the topic of the total amount of money lost to corruption and state capture, allegedly masterminded by the Gupta family, saying: "Ask yourself, would we really needed to have collected R20bn in VAT if we, even to a small extent reduced corruption?"To put up VAT by 1% is difficult," he added.Even more alarming was the unauthorised and wasteful expenditure amounting to between R60bn and R80bn that the auditor-ge...
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