Vaccine tax hike

Photo: Pixabay

Vaccine tax hike: How much could taxpayers be told to fork out?

If the Treasury does go ahead with a tax hike to fund the vaccine rollout, figures provided by SARS and the DA reveal what it may end up costing us.

Vaccine tax hike

Photo: Pixabay

South Africans have been left feeling a little anxious about a possible tax hike looming over the horizon. Reports have suggested that the Treasury will seek to squeeze the public for more money, in order to fund government payments for the COVID-19 vaccine. Needless to say, the alleged proposal has also riled the opposition party.

Treasury blasted for proposed ‘tax hike’

Several DA members shared their rage online, and Geordin Hill-Lewis was prompted to issue an official statement on behalf of the organisation. The shadow finance minister says any potential tax hike in the middle of a pandemic would serve as a ‘slap in the face’ for the taxpayers of South Africa, dismissing the idea as ‘callous and insensitive’.

“The DA strongly opposes the tax hikes mooted by Treasury Director-General (DG), Dondo Mogajane, to pay for the COVID-19 vaccine programme. Higher taxes would be a slap in the face of hard-working South Africans. The proposal is callous and shows an extraordinary insensitivity to the financial suffering of so many families right now.”

“In the context of an unprecedented economic crisis, Treasury’s suggestion of tax hikes is not only morally indefensible, but bad economic policy as well. It would be best for Treasury to find the funds necessary for adequate vaccine procurement through reprioritisation of funds in terms of the Public Finance Management Act – starting with cancelling the SAA bailout.”

Geordin Hill-Lewis

COVID-19 vaccine: How much more tax may we have to pay?

What is more, Hill-Lewis and his colleagues estimate the total cost of a vaccine rollout to be around the R15 billion mark. This is only R5 billion more than the bailout granted to South African Airways (SAA), and the DA is adamant that ANC decision-makers must now switch their priorities, to put the available funds where they are needed most:

  • The total cost of a comprehensive vaccine rollout is estimated at ‘roughly R15 billion’ [as per Geordin-Hill Lewis].
  • SARS’ latest taxation figures show that 22.9 million people in SA are currently paying income tax.
  • If we see the Treasury pursue a programme of tax hikes to fund the vaccine, the average additional tax increase will work out at R679 per person – assuming that 22.9 million people are targeted to fund a R15 billion project.
  • The DA says this amount is ‘comfortably affordable for the government’, who have already stumped-up R10 billion for SAA.