On 17 October 2014 the South African Revenue Service (Sars) advised of the report-back hearings of the Standing Committee of Finance (SCOF) held on 15 October 2014.
The Draft Taxation Laws Amendment Bill (TLAB), 2014 and Tax Administration Laws Amendment Bill (TALAB), 2014 were released for public comment on 17 July 2014. National Treasury and Sars briefed the Standing Committee on Finance on 30 July 2014 and the Committee heard responses from the public at hearings that were held on 26 and 27 August 2014. The final report-back to the Committee occurred on 15 October 2014.
According to Sars the comments on the policy issues received in both a written form and during the public hearings have been incorporated in the revised Bills. The comments falling wholly outside the scope of the Bills have not been taken into account for purposes of this response document.
The only reference to the Customs and Excise Act No.91 of 1964 was in respect of Section 47 of the Act “Amended provision for tariff determinations for alcoholic beverages”.
Comment: The proposed amendment would instantly void present excise tariff determinations and halt current production of alcoholic beverages until re-determinations have been obtained. There is an unacceptable risk that such tariff re-determinations may promptly render some existing alcoholic beverages unprofitable, leading to the discontinuation of these products after substantial investment.
Sars’ Response: Misplaced. In line with the announcement in the 2014 Budget Review, present tariff determinations for existing beverages will be upheld until their ultimate redetermination during the gradual phase-in of the amendment. In cases where such a redetermination gives rise to a tariff re-classification with a different excise duty tax implication, the new determination will only be applied going forward. This is provided the present determination was fully complied with and the beverage concerned did not alter in any substantive way after the determination was originally granted.
