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Year-on-year growth in the second quarter of 2026 came in at 0.9% yesterday, down from 1.9% in the first quarter (The Common Sense had forecast 1.2%). Of the many implications of South Africa’s low growth rate, one of the least mentioned is the effect on stunting the growth of the tax base and the extent to which this gives South Africa’s roughly one million serious personal income taxpayers great leverage over the government.

Here follows some of the data.

South Africa has a population of around 63 million people.

Of those, only around 16.7 million people, or 27%, are employed.

Around 7.1 million people, or 11%, earn enough to fall above the personal income tax threshold, meaning that they earn enough to register to pay personal income tax.

There are only around 750 000 people earning more than R750 000 a year, equivalent to roughly 1.2% of South Africa’s population, and these contribute approximately 56.7% of all personal income tax collected in South Africa.

How important is personal income tax to total government revenue? It contributes 39.7%, corporate tax contributes 17.1%, and VAT contributes 24.5%, with the balance made up by various levies and the like. But the people in that top R750 000 bracket are chiefly the same people who run the major companies that pay corporate tax and therefore drive the economic activity that makes VAT and levy collection possible.

It is therefore perfectly correct to say that under one million people are responsible for around 70% of all government revenue.

The chart below sets it all out:

The government treats that top taxpayer group with contempt on both a substantive and petty scale. On the substantive scale, it dictates to them who they might employ or where they might invest, threatens to expropriate that investment, and threatens to nationalise their healthcare. On a petty scale, as as the Democratic Alliance is now doing, it wants to tell them how many dogs they are allowed to keep, and tax them on any surplus.

On the other end of society, around 26 million South Africans, or 45%, receive some form of social grant. This means there are roughly four social grant recipients for every person earning enough to fall above the personal income tax threshold. For every one person earning more than R750 000 a year, there are approximately 77 other South Africans, 21 employed South Africans, and 35 social grant recipients.

And that direct social grant number is just the start of the broader welfare system that the fewer than one million people support. To grants must be added free state or subsidised state healthcare, free or subsidised school education, free or subsidised university education (which serves as welfare for large numbers of people in their late teens and early 20s), the payment of large numbers of unnecessary civil service salaries (which serve as middle-class welfare), and the financing of black economic empowerment (which serves as welfare for South Africa’s class of politically connected oligarchs).

It is a very large upside-down pyramid balancing on a very small point. That point will not get much bigger in a very low growth environment that remains as hostile to investment and entrepreneurship as South Africa’s broader policy environment is. But the very low rate of economic growth will make demands on the state grow ever larger without the revenue base to meet them. The effect can only be that public frustration with the government increases and that voters look to all manner of alternative political solutions, more radical parties, and ultimately enclaves.