Have you ever wondered how long it takes the average South African to work off his / her annual tax bill?

Tax Freedom Day (TFD) marks the day that the average South African answers this very question as it calculates when the taxpayer has earned enough money to cover their annual tax bills and can start spending their earnings on themselves. For 2009 the day was May 10 – that’s right over one-third of your year (129 days) has been spent working to pay for the costs of government!

Now the question that needs to be asked is whether you feel that you have received any value for the large sacrifice you have made? Has government recognised your sacrifice and spent your money to bring about better education, healthcare, housing, policing and general upliftment for the community in which we live?

We at the TPM certainly believe not! After all, these are the things for which we have worked, not bailouts of SAA and the SABC, not lavish allowances for ministers and definitely not corrupt civil-servants.  We aim, with your help, to make government aware that when they misallocate our money and do not prioritise on infrastructure and welfare, they harm both the potential recipient, who now goes without, as well as the taxpayer from whom they took – it is most harmful when one falls into both categories, as most of us often do.

The concept of TFD was developed to provide a measure of the contribution that middle-income taxpayers make to cover the total costs of administering government. Garth Zietsman, the statistician responsible for calculating TFD, says it “is calculated by dividing general government revenues by gross domestic product at market prices to establish what proportion of the year’s labour goes to paying for government. That proportion is converted into days of the year to arrive at TFD”. The 21 taxes levied in South Africa are taken into account.

The greatest value of the concept is that it gives us an indication as to whether government is taking more or less of our money each year, how much taxes are increasing or decreasing, and how our taxes compare with the taxes of other countries. South Africa’s TFD has been moving further into the year, between 2001 and 2008 government appropriated an additional 23 days of the working lives of the average person. In 2009, it has given back two days, probably by accident.

We hope that government’s attitude in the coming year will begin to change, that they will recognise the hardship that exist around them, that TFD will come earlier but above all that the sacrifices we have made will not be in vain but go to where it is needed most.

We welcome your comments  and suggestions on this issue.

Source: Free Market Foundation – Adapted

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