Duty Calls

Steel duty increase
On 03 March the South
African Revenue Service
(Sars) announced an
increase in the ‘general’
rate of customs duty on f lat
rolled products of stainless
steel from free of duty to
5% ad valorem, through
the substitution and
insertion of various tariff
subheadings.
The increase in the
rates of customs duty
only applies to the tariff
subheadings relating to
‘other’ – the last two digits
denoted as ‘90’ – where the
rate of duty increased to
5% ad valorem: 7219.11.10;
7219.11.90; 7219.12.10;
7219.12.90; 7219.13.10;
7219.13.90; 7219.14.10;
7219.14.90; 7219.21.10;
7219.21.90; 7219.22.10;
7219.22.90; 7219.23.10;
7219.23.90; 7219.24.10;
7219.24.90; 7219.31.10;
7219.31.90; 7219.32.10;
7219.32.90; 7219.33.10;
7219.33.90; 7219.34.10;
7219.34.90; 7219.35.10;
7219.35.90; 7219.90.10;
7219.90.90; 7220.12.10;
7220.12.90; 7220.20.10;
7220.20.90; 7220.90.10;
and 7220.90.90.
Then there were tariff
subheadings substituted –
7219.33; 7219.34; 7219.35;
7219.90; 7220.12; 7220.20;
and 7220.90.
The reason for the
increase in certain tariff
subheadings is contained
in the International
Trade Administration
Commission of South
Africa (Itac) report no 535.
Whether the 5% ad
valorem will suffice for its
intended purpose is to be
seen.
Customs and VAT
Undercollection
In an unprecedented move
Sars on 24 February, two
days after the Finance
Minister’s 2017 Budget,
issued a media release titled
“ Post-budget speech on
revenue collections”. If you
have not read it, you should
do so.
The release addressed
the significant downward
revision of R30 billion from
the printed estimate for
the 2016/17 financial year,
which was attributed to
three reasons.
The first two were that
Customs duties were down
by R6.5 billion as a result
of a contraction in real
terms in imports; and
value-added tax (VAT) was
similarly dragged down by
import VAT collections to
an underperformance by
R11.3bn. Why not change
the basis of South Africa’s
customs valuation?
Interestingly, the rand
strengthened significantly
against foreign currencies
over the financial year
which one would have
expected to result in an
increase in imports. Why
did it not happen?
TBT Bananas
Comment
On 16 February the World
Trade Organisation (WTO)
committee on Technical
Barriers to Trade (TBT)
advised that it had received
a notice from South Africa
for draft regulations that
prescribe specifications
relating to the grading,
classification, standards
for classes, marking,
packaging, sampling
procedures and methods of
inspection for bananas on
which comment is due by
16 April.
Duty Calls’ Watch
List
Comment on National
Treasury and Sars’ Diesel
Fuel Tax Refund System is
due by 15 May.
Comment on the vintage
motor vehicle rebate
provision is due by 17
March, while the unframed
glass mirror sunset review
is due by 18 March.