TV licence is a tax — Outa

The Organisation Undoing Tax Abuse (Outa) said TV licences should be covered in a money bill and that the Minister of Communications should not be responsible for setting the licence fees.

These comments formed part of Outa’s submission to the Department of Communications and Digital Technologies about the SABC Bill.

Outa said the SABC Bill should address the funding crisis for the public broadcaster by regularising state funding.

“There is no doubt about SABC’s value as a public broadcaster, and we believe this role needs support,” Outa said.

Outa believes that television licence fees amount to a tax or revenue in terms of section 77 of the Constitution.

“The mere fact that a person has to pay a fee for having a television set whether it is used or not amounts to a tax or levy,” it said.

“One might still argue that where the set is used, there is a benefit which accrues to the possessor, but to pay for mere possession is akin to paying duty tax.”

Outa argues that TV licences should be covered in a money bill instead of licence fees.

“This would also mean that the Minister of Communications and Digital Technologies should not be responsible for setting the licence fees,” it said.

SABC’s annual report 2019/20 points out that only 2.5 million licence fees were paid, out of a database of 9.5 million licence holders, providing revenue of just R791 million.

It is a significant failure that needs addressing, Outa said.

The television licence fees are meant solely to fund the SABC’s public broadcasting services, not the commercial services.

However, Outa raises concern that SABC does not separate these revenue and spending streams in the annual finances, as legally required.

Outa also suggests considering a regular annual state grant for the SABC’s public broadcasting services.

“This would avoid the irregular and disastrous last-minute bailouts but provide a more stable revenue stream, particularly for the public broadcasting sector,” said Outa.

Outa further suggested cutting funding to wasteful programmes and diverting some of this to the SABC.

For example, the National and Provincial Legislatures could provide some funding in the furtherance of democracy.

These institutions manage to provide hundreds of millions of rands to political parties to support democracy. Outa believes that some of these funds could be more usefully diverted to the SABC.

Now read: Goodbye TV licence — Watch DStv without paying the SABC

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TV licence is a tax — Outa