On 20 July Sars announced draft Rule 19A3.01 to the Customs and Excise Act, 1964 for the storage of fermented ethyl alcohol in a licensed special storage warehouse on which comment was due by 26 July.
The amendments relate to (i) the insertion of rebate items 621.23, 621.25, 621.27, 621.29,621.33, 621.35 and 621.37 to provide for the movement of alcohol derived from the process of extraction, respectively; (ii) the insertion of rebate items 620.18 and 620.20 to provide for the production of fermented ethyl alcohol by-product and the substitution of rebate items 620.19 and 620.21 to include the manufacture of non-alcoholic beverages by a process of extraction; and (iii) the substitution of rebate item 619.07 to include the manufacture of non-alcoholic beverages by a process of extraction and the insertion of rebate item 619.09 to provide for the production of fermented ethyl alcohol by-product.
By way of explanation: New technologies in the alcoholic beverages sector allow for the extraction of alcohol from beverages of a fermented origin. The current rules provide for the application of such fermented ethyl alcohol in primary or secondary spirits manufacturing, the denaturing thereof for rebated use, or the export thereof. This proposed rule amendment will in addition provide for the storage of such fermented ethyl alcohol in a licensed special storage warehouse for the un-denatured supply thereof to registered rebate users. The draft rule amendment must be read together with the proposed rebate amendments.
The Rebate Items 619.07, 620.19 and 620.21 have been amended to include wine, other fermented beverages and beer that have undergone a process of extracting the alcohol, to manufacture non-alcoholic beverages.
Rebate items 621.23, 621.25, 621.33, 621.35 have been created to provide for the fermented ethyl alcohol by-product derived from the extraction process to be moved to a primary (VMP) or secondary (VMS) warehouse to undergo any further processing.
In addition, Rebate Items 621.27, 621.29, 621.37, 621.39 have been created to provide for the fermented ethyl alcohol by-product derived from the extraction process to be moved to a special storage warehouse for the undenatured supply thereof to registered rebate users or export.