This proposed bill to tax South African expats has me baffled. For a number of reasons. It’s making me worried too (I’m a Virgo, it’s in my nature). I’ve read many articles, seen groups on Facebook trying their utmost to grow their numbers to petition the finance minister’s proposal and I’ve reached out to a few people too. Cape Talk’s Kieno Kammies spoke to a tax practitioner this week (listen here) and from that, I thought it might be a good call to gather my thoughts, questions and put this post together. This isn’t what you would expect to read on me blog, but because I’m on what some may call an adventure that involves a fair amount of weekend getaways, this proposal will directly affect me. So maybe some tax experts can weigh in here.
Disclaimer: If you have an opinion that you wish to add, please be constructive (whichever side you are on). Hate speech or cockiness is not necessary. I’m trying to understand this and also have an adult conversation. K, thanks, humans.
1. Why should you have to pay tax if you aren’t living there anymore? Paying for something that you’re not benefiting from seems a bit pointless don’t you think?
2. People go abroad to save and travel. Surely it’s their choice to do so? If they return, they will be paying tax and contributing to the economy they now live in.
3. How will SARS implement this? Do they know the number of citizens living abroad? This is going to be very costly to the economy. Another area where budgets and resources could be better allocated, perhaps?
Yes, moving to low/ no tax jurisdictions seems appealing. ‘Inflated’ salaries are a thing, but don’t think for one second we’re living like kings and queens. Rent is ridiculously expensive for what you get. Food and transport aren’t cheap either. Then there’s just living; movies, celebrations with friends, escaping the city for a weekend getaway, VISA APPLICATIONS (Death)… When you add it all up, those inflated salaries are done. So with this new proposal of being taxed on top of paying those bills means there’s not much left. You’re also now, by SA standards, in a higher tax bracket, so obviously, you’ll need to pay more when doing the tax return.
So what are the choices? Of course moving back to SA isn’t a bad choice – it’ll always be home. I’m just not there right now. Sometimes you just need a bit of adventure in your life. I’m not married, I don’t have kids, I don’t run a business… I’m relatively responsibility free. So why not take up a challenge, an adventure like this while I can? If I’m to be somewhat selfish for a change, professionally this is good for me. I’m able to gain international work experience, which is arguably the biggest pro in this whole experience. Plus, I love to travel, but traveling from SA often isn’t doable from a financial perspective. Geographically it’s challenging too.
Look, I’m in my 30s. I didn’t move abroad, leaving my family and friends behind to battle to make ends meet. That’s not the life I want. So I guess, I’m left wondering WHAT NOW? I’m just keen to hear from the experts and my fellow expats.