The booming South African Taxi industry that doesn’t pay any tax … at least directly
The minibus taxi industry in South Africa, moving eight out of every ten public transport commuters daily. It is a massive, highly influential economic engine.
Black News 
There is a South African urban transport industry which does not pay taxes despite making more than 100 billion rands, equivalent to nearly US$ 6 Million.
In a country where the city commuter bus system leaves a lot to be desired, the minivans, known there as ‘Taxis,’ take over the task of ferrying people around cities, towns and their suburbs.
In South Africa, these microbuses, minivans and minibuses are the de-facto people movers in Cape Town, Durban, Johannesburg, Pretoria and other urban precincts in the country.
The minibus taxi industry in South Africa, is moving eight out of every ten public transport commuters daily.
It is a massive, highly influential economic engine, but its relationship with the country’s tax system is a point of major national debate.
According to figures from the Department of Transport and national treasury, the industry generates between R60 billion and R100 billion per year.
It directly creates up to 300,000 jobs supporting drivers, queue marshals, washers and tax rank managers.
There are an estimated 200,000 to 250,000 minibus taxis operating on the roads, in South Africa.
The government notes that the commuter van market also faces heavy oversaturation.
Buses that ply on most routes are usually Toyota Hiaces, that are branded ‘Quantum,’ in South Africa with a few Ford Transits and Mercedes Benz Sprinters in between them.
Do the Taxi owners Pay Taxes?
Directly, very little, Indirectly, a massive amount.
The South African Revenue Service (SARS) and the Ministry of Finance have historically revealed that the entire taxi industry contributes only about R5 million annually in direct Corporate Income Tax (CIT).
Because the vast majority of operations are cash-based and informally structured, it is highly difficult for the South African revenue authority to track exact revenues, enforce Pay-As-You-Earn (PAYE) tax for drivers or collect corporate income tax on actual profits.
Most operators declare a “Nil return” (Zero profit) or do not register at all.
The industry’s only billions contribution to the national fiscus is in indirectly,
■Minibus taxis consume billions of liters of fuel.
Every single liter purchased includes the General Fuel Levy and the Road Accident Fund (RAF) levy, making this the industry’s largest tax contribution.
■Taxi operators pay 15 percent, Value Added Tax (VAT) on the purchase of new vehicles (like the Toyota Quantum), replacement parts, tires and mechanical services.
