On 03 February 2023, the South African Revenue Service (SARS) proposed amendments to Rule 19A to the Customs and Excise Act, 1964 relating to the implementation of tobacco products related excise duties on nicotine and nicotine-substitute solutions in vaping products, and specifically to:
- Draft DA 260 tobacco products (SOS)
- Draft DA 260 tobacco products (VM)
Government proposed a flat excise duty rate of R2.90/ml for both nicotine and nicotine-substitute solutions in Part 2A of Schedule No.1 to the Act, 1964 (Specific Excise Duties on Locally Manufactured or on Imported Goods of the Same Class or Kind). This was published in the Taxation Laws Amendment Act, 2022 dated 05 January 2023.
The proposed Rule and Form amendments relate to the administration of the tax which will be implemented on 01 June 2023.
Please note that the current publication for comment relates to the draft rules and forms under the Act, 1964, for the administration of the excise duty on vaping liquids. The imposition of the excise duty on these products and the rate at which it would be taxed are policy decisions that were consulted through the Taxation Laws Amendment Act, 2022, process through Parliament. The current publication of the draft rules and forms are meant to elicit comments on the proposed administration and are not a reopening of the earlier policy debate. Stakeholders are therefore requested to please comment specifically on the proposed administration of the excise duty on these products and not on the policy aspects that were previously considered.