ANC wants tax hikes to finance unconstitutional NHI

4 March 2024

The DA notes National Treasury’s intention to levy additional taxes on hard-working South Africans to fund the National Health Insurance (NHI).

The projected financial impacts of the NHI are alarming and estimates have reached as high as R859 billion per annum. Since the introduction of the NHI Bill, the government has remained elusive about its funding. The Treasury has now indicated plans to hike taxes, by an undetermined amount, to finance the impractical and destined-to-fail NHI.

The South African economy is already beset by one of the most onerous tax regimes in the world and any tax increase will be unduly burdensome, highly regressive, and disproportionately impact lower-income households.

South Africans are already battling a cost-of-living crisis without any relief from government – that could very easily cut fuel taxes and expand the zero-vat-rated food basket. Yet, the government’s indifference is palpable, especially as they consider tax increases while many citizens struggle to meet basic needs.

Governmental impositions on income, consumption, and property ownership, aggravated by public resource mismanagement through waste, corruption, and embezzlement, have eroded public trust significantly. The ANC's intensified efforts to hike taxes to fund their populism therefore warrant collective opposition. Taxpayers must realise that their contributions are squandered by an indifferent and morally bankrupt dispensation that needs money to finance its patronage networks, not service delivery.

The DA’s position is clear. We remain committed to the principle of universal access to healthcare for all citizens. But the NHI Bill is unconstitutional and will only serve to further erode an already ailing national public health sector.

Government’s model of centralising all healthcare funding into a new state-owned entity in which private sector resources and state resources will be merged into a single funding pool controlled by the Minister of Health is a recipe for disaster.

Instead, our model, presented in the DA’s Manifesto and healthcare policy documents, outlines how sustainable access to healthcare can be achieved by fixing the current district management model through governance reform. By leveraging the strengths of the private sector in partnership with the public sector, a DA government will provide access to high quality healthcare for every South African, without increasing the tax burden.

The Bill now awaits President Ramaphosa's signature. While the President has been looking for his pen to sign it into law, the DA has sought legal counsel and stands ready to oppose this draconian legislation that threatens to bar access to quality healthcare for South Africans.

Issued by Dion George & Michele Clarke, 4 March 2024