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#TaxesMustFall? Poor governance, coupled with tax increases could trigger Nene’s tax revolt nightmare

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Wayne Duvenage is a businessman and entrepreneur turned civil activist. Following former positions as CEO of AVIS and President of SA Vehicle Renting and Leasing Association, Duvenage has headed the Organisation Undoing Tax Abuse since its inception in 2012.

Over the past decade South Africans have seen unreasonable annual increases to property rates, vehicle licence fees, conventional toll tariffs and many other taxes. Hiding behind the pressures of inflation, the plethora of taxes continue to soar, while the delivery of public services degenerates, pushing the hard pressed citizen to a multi-faceted breaking point that could lead to a tax revolt.

The students’ #FeesMustFall campaign has spiralled into something much greater than it started out to be, and its trigger is the same keg of powder that might ignite the government’s biggest headache; a multi-faceted tax revolt across all three tiers of government. Taxpayer frustrations are mounting against the government’s continual and often excessive rates and tariff hikes at all levels, which are often attributed to the insatiable thirst of burgeoning corruption, maladministration and sheer ineptitude within the public service.

Over the past decade we have seen unreasonable annual increases to property rates, vehicle licence fees, conventional toll tariffs and many other taxes. Hiding behind the pressures of inflation, the plethora of taxes continue to soar, while the delivery of public services degenerates, pushing the hard pressed citizen to a multi-faceted breaking point.

Take the burgeoning annual vehicle licence fees for instance, a regional tax on motorists which has increased by roughly 195%, over the past decade in Gauteng, while potholes and traffic lights on the blink get worse. The vehicle owner has been a soft target for too long now, with fuel levies adding insult to the ‘great motorist rip-off’, following an increase of 167% in rand contributions over the past decade. Add in the questionable vehicle emissions taxes and the irrational e-toll fees and one gets a clear sense that the envelope of motorist taxes has been pushed too far and a backlash is looming, with an even bigger one due from the trucking industry.

One wonders if the authorities have realised their vulnerability to a tax revolt at local and regional levels. If pushed too far, tax payer frustration could fuel a collective energy and action to justify a call to stop paying for vehicle licences, threatening the regions with billions of rands in lost revenues.

The South African National Road Agency’s (Sanral’s) desire to have the non-payment of e-tolls linked to the renewal of licence fees will undoubtedly spark the vehicle licence tax revolt in Gauteng, and the rest of the country may even follow suit. The Opposition to Urban Tolling Alliance’s call to the provincial and national governing authorities has been to reject Sanral’s request to link e-toll regulations to vehicle licence renewals. Acceding to Sanral’s call will merely trigger a new wave of protests and another test of government’s legitimacy.

Unlike electricity and water, where no-pay means no-service, vehicle licence fees and property taxes offer an easy target for society to withhold their tax contributions – especially when the governing authorities give them just reason to do so. And nobody wants to invest in a country fraught with tax revolts.

The developing wave of dissent amongst property owners, who have been at the mercy of exorbitant unjustified municipal rate hikes over recent years, is fast becoming a powder keg for a property tax revolt. Take for instance the behavior of Mogale City Municipality. Low on funds after years of mismanagement, it has recently decided to subject many of the Magaliesburg tourist venues and businesses to unreasonably high increases in the property tax valuations of this rural tourism community.

To top it all, Mogale City does very little for these businesses and cannot justify these increases, some as high as 300% within a few years. Most of these businesses obtain their electricity directly from Eskom, and their water from boreholes. The only municipal service provided to them is refuse dump management and that doesn’t begin to justify the fees levied.

Furthermore, the value of many of these small hotels and country lodges has declined as a result of Home Affairs Minister Malusi Gigaba’s bright idea of stringent visa regulations, which have added more pressure to an already struggling tourism industry. With the local council’s ignorance of their plight, these businesses will have no option but to form a class or collective action to withhold their taxes from the Mogale City council, and similar actions may ensue at other tourism centered regions across the country. #VisaRegulationsMustFall.

The student’s ‘fees-must-fall’ campaign has sent a loud and clear message to all public authorities: Display accountability first and think hard before you increase future fees and taxes. Listen carefully to your rate-payers or prepare for the mass actions that could very well unfold.

To Finance Minister Nhlanhla Nene and regional finance MECs, I would go so far as to say there is little justification for the usual annual tax and tariff hikes. You have exhausted your rights to lump public servant inefficiencies onto a tired public, who are fed up with excuses and declining service levels.

This time around, take action by looking inward. Turn now to your fellow public servants with a demand for improved efficiencies, greater competence, reduced costs and less staff. Reduce your salary increases and display stronger leadership. Reign in your rogue agencies like Sanral, the Passenger Rail Agency of South Africa, Eskom and others, who believe they are a law unto themselves and treat the public as their private cash cows. Known corrupt officials must be dismissed and tried.

The time has come for the head of state and the Cabinet to oversee a genuine and vigorous campaign to stamp out corruption, stop the squandering and tackle the maladministration, before any thought is given to tax increases next year.

And should this call from a weary public be ignored, the #TaxesMustFall campaign will surely begin to unfold – like an anti-cancer – to starve the rot with self-inflicted tax revolts to challenge the glut of mismanaged power. The choice is yours Messrs Local, Provincial and National Leaders. The choice is yours, but make it quickly. DM

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