Calls for South Africa to introduce a wealth tax have intensified amid budget shortfalls and staggering inequality.
But Finance Minister Enoch Godongwana has doubled down on income tax as the most efficient way to collect from the rich - arguing that it generates significantly more revenue, costs less to administer, and comes with fewer economic risks, as reported by Daily Investor .
Responding to a Parliamentary question from MK Party MP Sanele Mwali, Godongwana rejected the idea of imposing a direct tax on personal fortunes. Instead, he defended the countrys existing system, which already captures wealth through multiple channels - including estate duty, donations tax, capital gains tax, and levies on property and securities transfers.
These taxes collectively brought in R21.3 billion in the 2024/25 financial year, down from R22.6 billion the year before, and slightly below the 2021/22 figure of R22 billion. Still, Godongwana pointed out this 1.15 slice of the total tax pie compares favourably with the OECD average of just 0.5 for similar wealth-based taxes.
South Africas income tax system is highly progressive, with the wealthiest individuals paying up to 45 in personal income tax. When paired with capital gains tax and dividend taxes, it forms what the minister calls a comprehensive taxation framework that already targets wealth in multiple forms.