FOOTNOTES
HILARY JOFFE: Fuss over VAT puts focus on how fiscal policy can reduce inequality
When the Davis tax committee called for public submissions on a proposed wealth tax in 2017 it received more than 300 submissions. By contrast, when it called for submissions on value-added tax (VAT) a few years ago, just 22 arrived. It’s a measure, perhaps, of the extent to which VAT had fallen off everyone’s radar screens over the past quarter century since the VAT rate was last increased. But the budget proposal to raise the VAT rate by one percentage point has evoked huge controversy, much of which relates to questions of income and wealth inequality, the same questions that call for a wealth tax target. Much energy and research is now at last going into the tax, which contributes a full quarter of government revenue. It is raising some intriguing questions about how best to tax and target to ensure fiscal policy reduces rather than increases inequality. Some of that thinking was on show in a VAT seminar at the Wits University School of Economic and Business Sciences, where ther...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.