On 21 August the International Trade Administration Commission of South Africa (ITAC) called for comment on the directive to investigate and evaluate the creation of rebate facilities (Rebate Items) to address the supply of textiles for use in the manufacture of apparel. It’s due on 04 September.
Creation of a Fourth (4th) Schedule rebate, as follows: “Textile fabrics, classifiable in Section XI, for the manufacture of articles of apparel and clothing accessories, classifiable in Chapters 61 and 62, in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit, provided the fabric is not specifically covered by another rebate provision in Schedule No. 3 for the same industry and purpose.”
Such rebate to be subject to, inter alia, the following conditions:
a) ITAC may limit the rebate provision to a list of qualifying fabrics, should it be deemed necessary. Such list to be determined and published by ITAC on its website, which is aligned and attached to reciprocal off-take commitments as identified by the DTIC, within the ambit of the R-CTFL Masterplan.
b) Current volume and value offtake from local Textile Mills not to be reduced
c) Develop opportunities to deepen the value chain
d) Price Restraint
e) Time-limited basis/Rebate review
Critical Note: Comments must be provided in the format of a questionnaire obtainable on ITAC’s website at www.itac.org.za, by following the links: ‘Services - Tariff investigations - Government Gazette Notices – Other publication notices.’]
The application was lodged by the Department of Trade, Industry and Competition (DTIC) who reasoned that:
- Under the R-CTFL Masterplan, Government has committed to creating an enabling environment for investment and growth in the industry. In particular, commitment four calls for strategic use of tariffs and rebates. Action points under commitment four include, inter alia, the review of rebate provisions on imported primary materials and components to support localisation of manufacturing, subject to:
- Demonstrated, measurable and enforceable employment and investment growth benefits;
- Future rebates subject to strict conditionalities (e.g. Bargaining Council compliance, tax compliance);
- Effective enforcement to prevent abuse; and
- Taking account of employment and production across the value chain, including
textiles.
- The Government has been approached by retailers in the clothing sector who have highlighted challenges in obtaining sufficient apparel due to disruption in their supply chains due to the spread of the COVID-19 virus. These issues were ventilated at an inaugural Executive Oversight Committee meeting on 12 March, which was attended by representatives across the Retail, Clothing, Textile, Footwear and Leather (R-CTFL) value chain. Stakeholders have advised that appropriate support would accelerate localisation of apparel manufacturing in South Africa.
The Notice is accessible at:
https://www.gov.za/sites/default/files/gcis_document/202008/43632gen446.pdf
Story by: Riaan de Lange