Africa’s richest economy plans to tax more millionaires to boost revenue

South Africa, Africa's richest economy with a GDP of $400 billion, is planning to increase taxes on millionaires to boost revenue and address its fiscal gap. The South African Revenue Service (SARS) is considering expanding the criteria for its High Wealth Individual (HWI) unit, which currently manages taxpayers with assets of at least 75 million rand.

The threshold may be lowered to capture a wider pool of wealthy individuals. This move comes as South Africa, like Nigeria, faces economic challenges such as sluggish growth and rising debt.

The proposed tax framework includes tightening compliance, expanding luxury taxes, and introducing a digital tracking system for assets. Despite already collecting billions of rand through the HWI unit, there is still potential for significant gains.

Nigeria is also aiming to increase revenue through improved compliance and broader tax coverage to meet ambitious goals.