Budget Woes: Trust in SARS, tax evasion as a protest against state capture, corruption?
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CAPE TOWN – According to South African Citizens Survey (SACS) by Citizen Surveys’ data, trust in the SA Revenue Service (SARS) was at its highest point (62 percent) in the first quarter of 2018, when President Cyril Ramaphosa took office and committed to bringing the perpetrators of state capture to heel.
However, by the third quarter of 2018, trust in SARS dropped to a low point of 54 percent, corresponding with the commissions of enquiry into state capture and their exposure of the depth of the problem.
When SARS confirmed that it intended to investigate the tax evasion claims arising from the Zondo Commission, trust improved. However, as no significant action was taken subsequent to last year’s general elections, trust in SARS dropped again, ending the year at 57 percent.
Is the average South African aware of the budget speech?
According to Citizen Surveys’ data, just over half (54 percent) of all South African adults aged 18 years and older watched, listened to, or were aware of the February 2019 Budget Speech delivered by Finance Minister Tito Mboweni. This number dropped significantly, to 36 percent, when it came to his Medium-term Budget Policy Statement (MTBPS).
Reza Omar, Strategic Research Director at Citizen Surveys, said just more that half of South Africans who were aware of the Budget Speech said it had a positive effect on their views of the country’s direction, but the MTBPS had a muted effect … more people said it had no effect on them (40 percent).
Omar said: “After the MTBS, only 44 percent of South Africans felt positive about the direction in which the country was heading, which was significantly lower than the effect seen in February (53 percent). That said, it did not increase the number of South Africans who felt negative; instead, those who said that it had no effect grew by 10 percent. In fact, the proportion of those who said that it had a negative effect dropped by 1 percent, which helps to explain Mboweni's favourability rating reaching 33 percent at the end of 2019 – the second highest among all political leaders measured.”
A critical element of the budget will be solutions to the challenges faced by the country, many of which involve the widespread historical and present corruption that is being exposed. In the last quarter of 2019, the South African Citizens Survey (SACS) by Citizen Surveys found that about three-quarters (74 percent) of South Africans believed that corruption in South Africa was on the increase.
Between January 2018 and July 2019, the South African Citizens Survey (SACS) asked 20 800 people if they thought that withholding the payment of tax was a legitimate form of protest. By July 2019, less than two- in- three South Africans (64 percent) believed that it was wrong to evade or avoid paying tax and that such people should be punished under the law. This was 10 percent lower than at the high of Ramaphoria in February 2018.
Omar said: “The financing of unnecessary and wasteful state expenditure, corruption, and State Capture are a strong disincentive for paying taxes. This helps to explain why one-third (33 percent) of South Africans sympathize or believe that there is nothing wrong with not paying tax. Citizens who do not trust SARS are far more likely to believe that it is acceptable not to pay tax”.
At the February SONA 2020, the President reaffirmed his commitment to tackling the perpetrators of State Capture. “This is a necessary step in helping to rebuild trust in SARS, and thereby improving the government’s ability to improve tax collection,” said Omar.