Saaff looks into alternatives for duty deferment scheme

JOY ORLEK SA REVENUE Service has called for alternative suggestions to replace the current duty deferment scheme. “This was posed more as an open question rather than a threatened withdrawal of the scheme,” SA Association of Freight Forwarders chairman Philip Womersley told FTW last week. Responding to a recent report in FTW, Womersley said SARS had called on SAAFF and the SA Chamber of Business to consider whether there was a preferable system. “There has been a lot of positive thinking at SARS and we at SAAFF will apply our minds and send the best researched reply that we can.” One of the clear disadvantages of the deferment scheme for SARS is the cash flow delay. The scheme allows importers and clearing agents to defer payment of customs duties and VAT on imported goods for a period of up to 30 days. “Obviously if SARS received its money on the date of the Customs bill of entry, its cash flow would be improved, but this could have serious implications for smaller companies. “Once we have looked into the issue we will come up with an evaluation of the alternatives,” said Womersley. Placing it in a practical context, Womersley points out that of the industry’s estimated 800 participating organisations, no more than 5% fall into the ‘over 50 employees’ category. The rest, being an estimated 95% of all registered clearing agents in South Africa, would be classified as SMMEs (small, medium and micro enterprises) whose survival could be threatened if the deferment scheme was scrapped. “This would go against government policy designed to support this sector, and we would need to think through all implications of such a major change carefully.”