| 227. | A payroll tax has potential as a further extension of the South African tax structure: the present payroll tax burden is low, it would be a buoyant and stable source of revenue and it would be administratively straightforward and health is one amongst several social benefits that could be financed in this way. It is administratively feasible as it will be based on an existing administrative framework and will require minimal changes to the existing tax administration system. However, it does not draw revenue from high income individuals who are not necessarily ‘employed’ (e.g. those whose income is from inherited wealth, investments, etc.) and may have a negative impact on formal sector employment creation, especially for entry-level jobs. |
