Is the South African economy about a fifth larger than current estimates?
My previous article showed that South Africa has more employees than it used to. Statistics SA revises this data every year, and has found some 16.4% more people since 2014.That is a lot of extra employees, and they earned more income too.
The above is not a shock for many as the data comes from official sources – in fact, the data comes from exactly the same source that publishes our GDP! But most of this data is based on administrative sources such as company and government payrolls and backed up by Unemployment Insurance Fund data.Early UIF data also supports the QES data and is essential as it supports other indications that the SA economy is larger than GDP data suggests.
Furthermore, the number of malls that SA sustains as measured in square metres is one of the highest in the world. Not quite as would be expected from a developing country . The Vat rate did not change for decades, and collections as a percentage of GDP increased in the period from the end of the 1990s to 2008/9. The increases in Vat-to-GDP are shown below. In 1995, Vat collection was under 5% of GDP. It peaked at over 7% and ended around 7% although the rate of Vat never changed.While SA bragged about how efficient Sars was, lately we have noticed how quickly tax slippage can happen and may now understand that it was GDP growth that also helped tax collections.
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