A tax study by two Western Cape researchers using data from 2016 has revealed that 5% of the country’s population earned just under a third of its gross domestic income.
Quoting from the study, Business Day writes that “the richest 5%, about 1.75m of adults earning more than R25 800 a month, earned in total close to 30% of SA’s national income in 2016.”
The study by UCT researcher Ihsaan Bassier and the University of Stellenbosch’s dean of economics, Ingrid Woolard, confirms an earlier World Bank report that found that South Africa was the most unequal country in the world.
According to the World Bank, the top 5% of earners in South Africa are better off than their counterparts in developed countries like Austria, while the lowest-earning 10% of the population are worse off than the lowest earners in some of the world’s poorest countries like Bangladesh.
The UCT study also found that the inequality gap was growing considering the amount of dollar millionaires that were based in South Africa.
Previously a figure of 45 000 South African citizens were said to be dollar millionaires, but this figure has jumped to 182 000.
This figure represents 0.01% of the country’s population of people earning more than R580 000 a month.
The UCT study was based on data released by SA Revenue Service and Stats SA, according to which only 4.8 million of the country’s 16 million employed people earned enough to afford paying tax.
The study’s findings have placed a damper on the National Development Plan’s central objective of shrinking the gap between rich and poor.
