DUTY CALLS

VAT Imported

Vegetables and Fruit

The South African Revenue

Service (Sars) published its

draft Binding General Ruling

(BGR) on the Value-added Tax

(VAT) treatment of the supply

and importation of vegetables

and fruit for comment on

18 March 2016.

The draft BGR VAT sets

out the VAT rate applicable to

the supply and importation

of vegetables and fruit and

withdraws BGR VAT No 18

dated 27 March 2013, ‘The

Zero-Rating of Various Types

of Dates.’ Just to clarify, the

‘BGR’ means a binding general

ruling issued under section

89 of the Tax Administration

Act, 2011.

The ruling defines ‘zerorated

supplies’ as the supply of

vegetables and fruit that have

not been cooked or treated

in any manner except for the

purpose of preserving such

vegetables and fruit in their

natural state. Fresh and frozen

vegetables and fruit supplied

in the following manner

are regarded as not having

been ‘treated’ as envisaged

in the said item numbers,

and therefore qualify for

zero rating: cut (including

vegetables and fruit cut into

specific shapes), diced, sliced,

shredded, crushed, minced,

pureed, peeled, de-pitted,

and compressed. The

aforementioned zero-rating

applies regardless of whether

the vegetables and fruit are

sold individually.

Frozen vegetables and

fruit that have been blanched

in hot water are regarded

as having been ‘treated’ for

the purpose of preserving

the vegetables and fruit

in their natural state, and

therefore the supply of such

frozen vegetables and fruit

qualifies for the zero rating.

The supply of a mix or a

combination of vegetables

and fruit by a store or similar

establishment, whether or

not at the delicatessen section

of the establishment, may be

zero-rated.

Vegetables and fruit

supplied in the following

manner are specifically

excluded (a) Cut, diced, sliced

or peeled vegetables or fruit

to which any other substance

has been added whether or

not separately packed in the

same container (other than

for purposes of preserving

the vegetables or fruit in their

natural state); (b) Fresh or

frozen vegetables and fruit

that have been treated with

an additive for the purpose of

adding colour or flavour (for

example, glucose, sugar or

salt); (c) Dehydrated, dried,

canned or bottled vegetables

or fruit; and (d) Vegetables or

fruit smoothies or juices, and

any similar products.

WCO Origin Tools

Guideline

The World Customs

Organisation (WCO) has

made its origin tools, such

as guidance materials that

were shared only among the

WCO members, publicly

available except those related

to customs controls. The

purpose of publishing the

origin tools is to further

enhance the transparency

of the WCO’s work in this

area as well as to provide

additional information to any

interested party.

Duty Calls’ Watch List

Comment on the following

is due:

Draft Customs Control Act,

2014 Rules by 01 April 2016.

The sunset review of the

anti-dumping duties on

unframed glass mirrors from

India, by 29 March 2016.

The Department of Trade

and Industry’s Enterprise

Development Pilot Project by

23 March 2016.

The proposed increase

in the rates of ordinary

customs duty on plastics by

18 March 2016.