South Africa Budget Targets the Rich

South African Finance Minister Pravin Gordhan has targeted the rich in his annual budget, announcing a new top tax rate of 45% in his 2017 budget.

It will apply to annual incomes of more than 1.5m rand ($114,000; £91,000) and will hit around 100,000 people.

Mr Gordhan is battling weak tax receipts which, during the current financial year have been 30bn rand ($2.3bn, £1.8bn) less than expected.

He pointed out that 95% of wealth is in the hands of 10% of the population – nearly 23 years after the end of apartheid.

And it is still very much skewed along racial lines.

The minister warned of “growing impatience and ferment” over post-apartheid inequality:

Economic growth is slow, unemployment is far too high and many businesses and families are under stress.

The relationships between labour and capital, rich and poor, black and white still reflect the entrenched legacy of colonialism and apartheid.

We do not seek to reproduce the racial domination that was the hallmark of apartheid nationalism.”

He also spoke frankly to his own comrades:

That which we expect the public to do, we in government must also do…where fraud and corruption is identified, action must be taken.”

This may well have been Mr Gordhan’s last budget speech given his fractious relationship with President Jacob Zuma.

Many see him as standing in the way of those wanting to loot government coffers.