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BL Premium reports that the Institute of Race Relations (IRR) has called on Health Minister Aaron Motsoaledi to repeal the National Health Insurance (NHI) Act, saying its restrictions on medical schemes will increase the emigration of SA’s biggest taxpayers and dent the corporate tax take.
SA has only about 862,000 individual taxpayers with an annual income above R750,000, who contribute 58.6% of all personal income tax paid to the fiscus, said the IRR, citing Treasury estimates for 2024/25. NHI also posed a threat to corporate income tax, as a flight of skilled mid to higher-level staff would cause corporate profits to plummet, said the IRR. Only 842 companies in SA generated an annual income of more than R100m, and they contributed almost three-quarters (72.4%) of corporate income tax, it noted. The Act was signed into law by President Cyril Ramaphosa in May, but has yet to be brought into effect. One of the most controversial aspects of the Act is its restrictions on the future role of medical schemes. Most people in SA’s highest tax brackets belong to medical schemes. If they quit SA in response to diminished access to private healthcare, the state will no longer collect enough revenue to maintain current spending on social grants and civil servant wages, nor have enough money for infrastructure investments in water, electricity, and transport, the IRR warned.
- Read the full original of the report in the above regard by Tamar Kahn at BusinessLive (subscriber access only)
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