They just don’t get it do they? Governments have developed this quaint notion that taking tax off us is a “service” and we should be grateful and perhaps even proud.
This week, news reached us that The South African Revenue Service (there’s that word again!) had opened a new business centre “to cater for large scale taxpayers”. Picture the ambiance of deep carpets, piped music, potted palms, art by the yard and lurking plush couches. “Clients” are plied with fake coffee in real cups before being ushered into an inner sanctum where the walletectomy will be performed.
Obviously governments do require money to operate. This fiscal year our chaps look as if they will need something like R375bn (up from R330bn last year) to keep the wheels turning. Odd as it may seem to a tax man, most of as intend very firmly to contribute as little as we can get away with. We believe that spreading what remains of our own money between “services” of our own choice will likely do just as much good as most government departments can manage. It will also be more fun.
There is a world-wide trend for politicians, many with dubious electoral credentials, to tap the public purse for purposes of patronage and reward. What results is a mushrooming establishment of bureaucrats who, like the politicos, believe that they alone have the sole best model for resource allocation and distribution. The assurance that everything is done “in the public interest” is not universally convincing. To raise a faint murmur of concern often brings a swift and furious response. Some examples from just this week come to mind
Here on the southern tip I suspect that most citizens, whether or not they are clients of SARS, would prefer to see more cash being directed towards the real and vital services rendered by the teachers, nurses and policemen and less being spent on Pan African Parliaments and the like. The contrast yesterday between the march of strikers in Pretoria and the sushi and chardonnay shindig in Midrand was stark.
Despite the religious holidays and a fairly uneventful futures close-out, the market steamed northwards this week. Bears like me spent a great deal of the time wiping egg from their faces and closing short positions in anguish and pain. The gap (“disconnect” in dealerspeak) between our All Share index (up 16% in the last six weeks) and the Dow (virtually unchanged in the same period) is noteworthy – but so far meaningless.
Liberty Group have followed the lead of Standard Bank with one of those schemes of arrangements (more correctly termed “confiscations”) which at current prices will see shareholders donating about 1% of their value to those deemed more needful than themselves. Where have we heard that story before? As we did for the Standard Bank scheme, we shall be voting all the shares which we hold in safe custody against the scheme – but it will not alter the outcome.
May the Lions wallop the Sharks.
James Greener
17 September 2004
