Political instability costing SA billions of rands

South Africa’s tax ombudsman, Judge Bernard Ngoepe, has expressed concern at the country’s political stability.

“We [South Africans] must say to ourselves that our economy is not okay,” Ngoepe said at a Leader’s Angle event hosted by the University of Stellenbosch Business School.

“My ultimate question is: do we really live in a politically stable country that allows for a healthy economy?”

The judge said a “huge” deficit, large unemployment number and the many people dependent on social grants were signs that “our economy is not well”.

“We are becoming a corrupted society. People are employed based on their political connections.”

One of the fundamental causes was that people were competing for scarce resources.

“Hospitals are overstressed. People in leadership positions should address these fundamental problems,” Ngoepe said.

“Just because there is a mere absence of civil war in the country does not imply that we are politically stable as a country.

“When parliament opened, more than 400 soldiers of the defence force were deployed for law and order. Can you really argue we are politically stable? Something is not right.”

Commenting on the burden of tax collection, Ngoepe said he was concerned that the increased tax bracket would influence the culture of paying tax.

“One of the basis for tax collection is that we are forced to pay it, but I think people should also feel morally obliged to pay tax. If we don’t spend tax prudently, then people will begin to justify their reluctance to pay tax,” the judge said.

“You never know in what form or way that reluctance will be expressed. Some people come up with very aggressive tax evasion schemes. Billions of rands are going out of the country as a result.” – ANA