Insights

Chasing the Sun: Taxation, Voting, and Contributing to South Africa’s Success

by | Apr 26, 2024 | Advisory Services | 0 comments

If you were not glued to your television screen for the past five Sundays, watching Chasing the Sun 2 and reliving the 2023 Rugby World Cup glory, where have you been hiding? 

Spoiler Alert: The Springboks won the Web Ellis Cup and, despite the numerous f-bombs, Rassie won our hearts with his speeches. In his closing monologue, Rassie recounted a conversation he had with the team urging them, and what seemed to be an address to the whole of South Africa, to hold onto this high and give back to South Africa. 

As we reflect on the lessons of “Chasing the Sun,” it becomes clear that each of us has a role to play in shaping the future of our nation, both through our actions on the field and in our civic responsibilities as citizens. 

Many of us devote considerable time and effort to meticulous tax planning, seeking to minimize our tax liabilities while maximizing our financial well-being. Tax planning in South Africa is also frequently motivated by a reluctance to allocate any additional funds to the government. By that same reasoning, this diligence should extend beyond tax planning to encompass a broader concern for how our tax dollars are spent by the government. By exercising our democratic right to vote, we have a say in shaping government policies and priorities, ensuring that tax revenues are allocated effectively to benefit society as a whole. 

For those engaged in generational wealth planning, the link between tax planning and securing South Africa’s future is even more apparent. Sustainable wealth preservation requires that we protect the source of the wealth. Where the wealth is sourced in South Africa, there should be a vested interest in ensuring that future generations inherit a country that is prosperous, stable, and equitable. This requires not only prudent financial management but also active participation in shaping public policies that foster long-term economic growth and social development. Essentially, your vote holds power in that it can protect and strengthen democratic institutions and the rule of law. 

South Africa’s political system is known for its credible democratic elections. Since 1994, there hasn’t been a single instance of elections being manipulated to yield a result contrary to the will of the voters. However, according to political analyst and journalist for News24, Mpumelelo Mkhabelo, the legitimacy of electoral outcomes requires more than the satisfaction of the technical requirements to prevent rigging. The social legitimacy of the outcome is dependent on voter turnout. Greater voter turnout would guarantee greater sociopolitical stability which would in turn improve investor confidence and reduce the temptation to adopt with populist policies. The risks ultimately lie in low voter turnout.

Paying tax and voting are akin to any other contract for services; there is a quid pro quo involved. Private individuals must fulfill their civic duty by voting and paying taxes, and the government should uphold its end by ensuring the lights stay on in South Africa (pun intended). As voting day comes closer, many may use the excuse that they are not going to vote because they either do not know which party to vote for or they do not believe their vote will make a difference. It is our submission that exercising your right to vote, is a cardinal element of wealth preservation planning. 

At Sentinel, for 25 years, we have been committed to being relevant in the lives of our clients, working towards the preservation of wealth, succession planning and tax mitigation. We aim to reduce the friction between individuals and government institutions, hoping that the same energy expended on individual planning extends to the sustainable preservation of South Africa. We aim to do this for many generations to come. 

As we bask in the glory of the recent “Chasing the Sun 2” series and the triumph of the Springboks, it’s a poignant moment to reflect on our collective role in shaping South Africa’s future. Maybe if we put the same energy into voting as we do into planning our finances, South Africa could really shine and all of her children, may play in the sun.

Annalise Heydenrych