Closer integration between customs and value-added tax (VAT) systems could reduce manual reconciliation and compliance discrepancies for freight businesses, according to the South African Association of Freight Forwarders (SAAFF).
The association has called for this integration as the South African Revenue Service (SARS) reviews stakeholder submissions on its proposed Digital VAT Model.
The model aims to modernise VAT administration through structured electronic invoicing, data interoperability and near-real-time reporting. It could potentially enable automated verification, pre-populated VAT returns and faster refunds.
Devlyn Naidoo, SAAFF’s head of trade facilitation, SARS and other government agencies, said effective integration would be important for freight forwarders and customs brokers managing high volumes of transactions across multiple clients, transport providers, shipping lines, depots and warehouses.
“We are proposing an architecture centred on the Movement Reference Number (MRN), linking customs declarations with import VAT records, financial invoices and VAT returns,” Naidoo told Freight News.
According to SAAFF, this would help align information across customs and financial systems, potentially reducing manual reconciliation and discrepancies that could trigger additional compliance interventions.
However, Naidoo warned that smaller operators could face disproportionate costs in adapting their systems to meet new requirements.
Other concerns included inconsistent data across customs declarations and VAT records, as well as international suppliers’ ability to issue invoices in formats compatible with SARS requirements.
“It needs to be a phased rollout, beginning with larger enterprises before extending requirements to smaller businesses,” Naidoo said.
SAAFF has also proposed a dedicated freight and customs industry pilot, affordable compliance solutions and an ongoing working group involving SARS, industry representatives and software providers.
SARS confirmed to Freight News that public consultation on the proposed model had closed on October 16 and that it was analysing submissions from businesses, industry bodies and other stakeholders.
The revenue service said it would be premature to comment on specific submissions, recurring concerns, potential system requirements, integration arrangements or implementation timelines before completing its review.
SARS said the consultation was intended to ensure that stakeholder perspectives and practical considerations informed further development of the model. The outcomes of its analysis and next steps would be published once the review is complete.
