WHY government should hand out FREE lottery tickets in SA
· The South African
As unlikely as it sounds, by handing out free lottery tickets in SA, government would start to close its R800-billion annual tax gap. The frankly ingenious idea comes from Taiwan, which suffered from a similar tax-gap problem we battle with today in South Africa. The missing R800 billion is equivalent to the National Treasury’s entire budget deficit …
As a result, R800 billion in business is being done informally each year in South Africa. And SARS cannot touch any of it. Transactions are cash only, not documented and that means there’s no paper trail for government to follow to take its cut. However, Taiwan boosted its tax revenue by 75% in just one year when it did this imaginative thing …
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FREE LOTTERY TICKETS IN SA
The Taiwanese government started printing lottery numbers on all sales receipts. These numbers gave customers a free entry into that day/week’s lottery. All of a sudden, traders had to produce a receipt at the demand of the purchaser. And just like that, the transactions were no longer off the books. Free lottery tickets in SA would be a similar solution to the vast tax gap.
South Africa’s informal sector is enormous. Beyond the hundreds of billions in turnover each year, it also employs millions of South Africans. Many of these businesses aren’t registered at all. Therefore, they are not seen as a formal business paying tax directly on their income. There has been growing pressure on the new SARS commissioner to bring more informal traders into the tax net.
NEW SARS COMMISSIONER IN HOT SEAT
Kieswetter brought in record revenue thanks to the auto-assessment, but Makhubu could do even better. Image: FileDr. Ngobani Johnstone Makhubu took over as commissioner of SARS at the start of May 2026, with big shoes to fill. He has five years to outdo Edward Kieswetter, and free lottery tickets in SA could be an ingenious tactic. So far, SARS has invested in better auditing tools and third-party data access. It’s also trying for real-time transaction monitoring and mandatory e-invoicing. Still, auditors face one basic limit. They cannot trace a sale that was never recorded in the first place.
Like South Africa, Taiwan faced this exact problem a few decades ago. Its economy ran on small cash shops that rarely issued receipts. Then Finance Minister Ren Xianqun found the unusual fix of printed lottery numbers directly on ordinary sales receipts. Critically, by introducing free lottery tickets in SA, it would shift the onus from SARS to businesses/consumers to follow official channels. Government enforcement wouldn’t matter as ordinary shoppers would do the enforcing on behalf of SARS. Even paying a few hundred million a year in prizes is a small cost against the tax revenue gained.
But what do you think? Could free lottery tickets in SA be a solution? Would you love to be entered free of charge to the lottery each week? Let us know your thoughts in the comments section below …