Oil and gas sector pins hopes on Sars amendment

Large provisional payments
and deposits that are
due to customs for the
import of temporary cargo
destined to service the oil
and gas sector are severely
inhibiting growth in the
sector.
But an expected
amendment to the Sars
tariff, which has been
welcomed by the Cape
Town Port Liaison Forum,
will hopefully address this
issue.
There are rebates in
place for companies
importing temporary
cargo for the oil and gas
ship repair industry which
suspend all duties and
VAT pending their total
compliance. But in the
interim customs requires
deposits to cover any
possible duty and VAT on
the imports which amounts
to a contradiction in terms,
according to a spokesman
for the forum.
“It restricts business
significantly and inhibits
growth of an industry
that the Western Cape
has clearly identified as a
sector that can benefit the
local economy hugely,” the
spokesman said.
The forum, as well as
industry role-players, have
been working closely with
customs officials in an
effort to find a solution to
the problem.
“We have been discussing
the possibility of a new
rebate item in the tariff
book that will address this
issue, but that will take
some time before it takes
effect,” the spokesman told
FTW.
“For temporary imports
a lot of security is usually
involved, and because
of the very nature of the
equipment used in the
oil and gas industry, it is
expensive and therefore the
deposits are large sums of
money.”
It is expected that the
South African Oil and
Gas Alliance (SAOGA)
will host a workshop later
this month in an effort to
unpack this issue and take
the matter forward with
customs.