Something is badly wrong with our tax system

Imagine you have a married couple, Jack and Jill, and that you have two possible scenarios for how they earn income:

In Scenario A, Jack earns R20,000 a month and Jill earns R20,000 a month.

In Scenario B, Jill earns R40,000 a month and Jack quits his job to be a stay-at-home dad.

Let’s look at how they would pay income tax in each scenario:

Scenario A (both earn R20,000).

 Annual Tax: R40,890 each, or R81,780 together. 

Scenario B (Jill earns R40,000, Jack R0)

 Annual Tax: R123,109

Wait a minute… That’s a difference of more than R40,000!

Jack & Jill are paying R40,000 a year in tax simply because, as a team, they are able to add the same amount of value to the economy. 

What’s the reasoning behind this? Is it to punish them for not both working towards SA’s GDP metric? 

Shouldn’t there be recognition that Jack will play a vital role as a teacher and role model for his kids which will lead to a healthier economy and country in the long term?

Or am I missing something here? Is there a way for them to get that R40,000 back? I would think that in some countries there would be tax breaks to counter this exact situation.

If not, I’d say that this is another proof that sliding scale tax systems are badly broken.

 

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Figures calculated using Old Mutual Income Tax Calculator available here

PayPal Business Accounts Now in South Africa

This morning I went to the PayPal site to see about signing up for it as a business. I really didn’t expect that I would be able to, but there, on the left hand side of the PayPal South Africa website, was a big call to action for businesses to open a PayPal account. 

 

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Within minutes I had signed up AND created a PayPal button which apparently will allow anyone with a PayPal account OR a credit card to make payments online. 

I have created a Donation button, which you *should* see below. Please test it and leave a comment if you have a moment Any money you donate will go to the Grandmothers Against Poverty & AIDS, an amazing organization of gogos helping each other and their communities, based in Khayelitsha.

 

 

Small Change, Big Result – Lessons in Web Design

Skyrove recently changed its homepage from this:

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to this:

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Almost immediately, the Time on Site (as reported by Google Analytics) increased by 65% and pages per visit increased 28%.

We will soon be making some more changes with the help of the brains at Rank&Copy. Watch this space!

The Kitchen in Woodstock: Featured in the NYTimes and what a great menu!

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I told you guys getting customers will get us into trouble!

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Seen at Tomizone Auckland offices. Uttered by CTO and written down for posterity.

Ka mate koe i te kai hikareti

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Vuvuzela reference in Auckland newspaper

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Google Docs Spreadsheets – Simple Calculation Error

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Kenya vs South Africa

Kenya is proving more lucrative per subscriber than South Africa – Mobile Advertising Network

I Will Fight for Freedom

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This morning, I was reflecting on Freedom Day and what it means??to me as a South African. Although we enjoy many, many more??freedoms in South Africa today, we are still very far??from a point where we can truly celebrate freedom.??

We are not free of violence. The farmer in the Free State nor the??grandmother in Khayelitsha are safe in their homes.??

We are not free to trade. There are major barriers for South??Africans who want to trade on the internet: the world's biggest??marketplace.??

We are not free to fail at business. For most of us, if we fail,??we lose everything.??

We do not have universal free healthcare. And the state provided??healthcare we do have is abominal.??

We do not have the freedom to choose high quality education,??unless we are rich.??

Many of us have fought hard for some of these freedoms, but we cannot fight every battle and every social injustice. I??believe the one thing most important for a thriving new??generation of Freedom Fighters is freedom of communication. Being??able to connect with each other is crucial if we want to see Social Change.??

Therefore, right now, my primary battle will be connecting??people. Skyrove, the company I co-founded, enables anyone to??build & manage Wi-Fi networks, simply. (When we started out,??we were flouting a law which prevented people from crossing public boundaries with any communications device. It was illegal to take 2 tin cans and a piece of string across your neighbours fence. This law was devised to protect the state??owned telecoms company and its foreign shareholders, SBC (now AT&T) &??Malaysia Telecom.)

If people have cheaper, faster options to connect, whether ADSL,??3G, Wi-Fi or smoke signals, it means people have increased access??to knowledge & education. This will lead to more people being free??of violence. It will lead to more people will be able to trade freely & easily and??achieve financial freedom.??

Better, faster & cheaper communication will ultimately lead to a??real, stable & free democracy.