SANTACO rejects claims that taxi industry doesn’t pay tax
The South African National Taxi Council (SANTACO) has labelled claims that the taxi industry does not pay tax as "misguided and shallow", emphasising that most operators comply by paying personal income tax individually.
Image: Armand Hough/Independent Newspapers
The South African National Taxi Council (SANTACO) has labelled claims that the taxi industry does not pay tax as "misguided and shallow", emphasising that most operators comply by paying personal income tax individually.
The industry has, for several years, often been accused of not paying its fair share. The Democratic Alliance(DA) has also previously raised the alarm, citing a 2021 parliamentary reply which revealed that the entire minibus taxi sector contributed only around R5 million in tax, despite estimates placing its annual revenue at R90 billion.
More recently, Organisation Undoing Tax Abuse (OUTA) has echoed those calls, urging the government to broaden the tax base by bringing both the taxi and informal sectors into the formal tax system.
However, SANTACO spokesperson Mmatshikhidi Rebecca Phala has rubbished claims that the industry is avoiding tax, saying such statements ignore how the taxi sector is structured and taxed.
“The perception is misguided and shallow. The taxi industry, in the main, is comprised of operators who run their businesses as sole proprietors. This means they operate their businesses as individuals and continue to be taxed as individuals,” Phala said.
"To prove this, they are issued tax clearance certificates by SARS, which they use for varied reasons, including in their applications and their renewals of the operating licenses, where the provision of said tax clearance is a prerequisite".
She added that the current tax framework does not fully accommodate the informal nature of the industry, and called for reforms.
"As such, currently, a large scale of the taxi industry does not participate in the greater companies' tax regime. The current structure of the tax reform needs to be relooked to ensure a speedy resolution of this taxation loophole".
"The taxi industry shouldn’t be perceived similar to public company; it is an individualised business whose operators have organised themselves into taxi associations".
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