The tiny municipality where the people who make the most money in South Africa live

South Africans living in the small Gamagara Local Municipality, containing the town of Kathu, have the highest average taxable income in the country. 

Located in the Northern Cape, this municipality has 10,979 taxpayers with an average taxable income of R508,901.

This means that, on average, individuals living in this town make the most money in South Africa – more than those in Johannesburg, Stellenbosch, and Cape Town. 

SARS revealed this as part of its 2025 Tax Statistics, which are compiled from the service’s registers of taxpayers and tax returns. 

These statistics are intended to complement SARS’ other data relating to tax collection, the size of South Africa’s tax base, and where the government’s revenue comes from. 

SARS releases these statistics to inform the National Treasury’s policy decisions relating to tax revenue and the broader economy. 

For example, they reveal a highly concentrated tax base, with a small number of taxpayers contributing a significant share of personal and corporate income tax. 

This means the government has little scope to increase taxes further, as it will likely result in less collection as wealthier individuals look to minimise their tax burden. 

As part of these statistics, SARS also breaks down tax revenue by provinces and municipalities to show which regions contribute the most to the fiscus. 

While SARS does not say which city, province, or municipality pays the most tax, it does release data on the average taxable income of all municipalities in South Africa. 

Provincially, Gauteng remains the richest province in terms of average taxable income, with the average taxpayer in the province earning R414,000 per annum. This is followed by the Western Cape at R348,000. 

After the country’s two most economically vibrant provinces, come South Africa’s smaller provinces in terms of population. 

These provinces, such as the North-West, Limpopo, and Mpumalanga, benefit immensely from their small populations and highly lucrative mining operations. This results in a relatively high average taxable income. 

The breakdown of the average taxable income by provinces can be seen in the graphic below, courtesy of SARS. 

Gamagara takes the crown

According to SARS’ municipal data, Gamagara Local Municipality has the highest average taxable income of any municipality in the country. 

The average taxpayer in Gamagara earns R508,901 a year, compared to R480,318 in Johannesburg and R451,052 in Stellenbosch. 

While this is surprising, it is relatively clear why the municipality, with Kathu at its heart, is number one on the list. 

The municipality, with its five small towns, has a significant advantage in its small population size compared to larger metropolitan areas. 

Gamagara has just over 10,000 taxpayers. This stands in stark contrast to Stellenbosch, which has over 36,000 taxpayers, and Johannesburg, which has nearly one million taxpayers. 

Despite this obvious advantage, Gamagara still has some way to go in terms of generating income for its population. 

This is where the town’s location comes into play, as it is home to the largest iron ore mine in South Africa, Sishen. 

Due to its proximity to this mine, it is also the start of the Sishen-Saldanha Railway, which is the longest heavy haul rail line in the world at 861 kilometres. 

This railway transports the valuable iron ore from the mine at Sishen all the way to Saldanha Bay, where it is loaded onto ships for export. 

The location of the mine, the start of the railway, and its small population mean that the local municipality contains a high proportion of very valuable jobs. 

These jobs at the mines or on the railway pay individuals well, giving them a high income relative to the average South African. 

Outside of Kathu and the mine at Sishen, Gamagara contains Olifantshoek, which is known for its wildlife and hospitality sector. This town is also growing strongly, transitioning from a small farming town into a high-density residential area. 

The table below shows the top ten municipalities in South Africa in terms of the average taxable income of their taxpayers.