A walk through the tax archives shows that kings, queens, the church, nobles and governments have, over the ages, taxed just about anything — from bachelors to beards, beehives, dogs, windows and soap.
This was primarily to raise much-needed revenue to pay for the upkeep of the rulers, wars and — since democracy — to fund government programmes.
That’s why the history of taxation — specifically what has been taxed or not taxed, at what rate and who pays the tax — tells a story about a particular moment in a country’s socioeconomic and political history.
So it is with SA today. Earlier this year, finance minister Enoch Godongwana proposed an increase in VAT, initially by a full-body punch of two percentage points but later scaled down to one percentage point over two years.
The proposal has threatened to tear apart the government of national unity (GNU), a political patchwork quilt President Cyril Ramaphosa stitched together to help him govern the country after his party failed to muster a majority during the 2024 national and provincial election.
It’s a reminder that taxation matters for politics. It tells a story about the state of society. And it has for centuries. Kings, queens, the church, nobility and governments have all learnt the hard way that taxation can trigger revolts, revolutions and popular protests.
Austrian-born political economist Joseph Schumpeter captures this brilliantly: “The spirit of a people, its social structure, the deeds its policy may prepare, all this and more is written in its fiscal history, stripped of all phrases. He who knows how to listen to its message here discerns the thunder of world history.”
Ramaphosa is feeling the thunder because Godongwana ignored centuries-old advice from Louis XIV’s finance minister, Jean-Baptiste Colbert. A reformer of France’s tax system in the mid-17th century, Colbert cautioned that “the art of taxation consists in so plucking the goose as to obtain the largest possible amount of feathers with the smallest possible amount of hissing”.
Godongwana hasn’t had his ear tuned to the sounds of the geese and therefore missed their foul mood. It’s a mistake that’s common in history. Just before the French Revolution, during which Louis XVI lost his head — literally, his controller-general Charles Alexandre de Calonne proposed a universal land tax and that the aristocrats — the political insiders — and other social categories no longer be exempted from it. These categories had seats in the assembly, power they used to block Calonne.
Opposition to Godongwana’s initial proposal came from inside the GNU tent. To borrow Schumpeter’s phrasing, the battle against the increase in VAT tells us about the spirit of South Africans, the socioeconomic structure of SA society and the failure of the country’s political leadership to hear society’s message. Embedded in that socioeconomic structure are high unemployment and poverty levels and a lack of trust in the government, fuelled by how it has mismanaged the country’s finances.
Godongwana has told the poor to stick to “walkie talkies”, not the whole chicken. He has proposed that walkie talkies — a township reference to cooked chicken feet — be exempt from VAT to cushion the poor from the increase in VAT.
His argument is that since chicken feet are mostly consumed by the poor, their choice for exemption will minimise the opportunity for the middle-income earners and the rich to benefit from the exemption.
But that choice tells a story. It says a lot about what government thinks of the poor. That they are only good for chicken feet.
• Sikhakhane, a former spokesperson for the finance minister, National Treasury and SA Reserve Bank, is editor of The Conversation Africa. He writes in his personal capacity.
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