Unions tighten the screws over illegal textile imports

The Southern African

Clothing and Textile

Workers’ Union (Sactwu)

has “pressed pause” on its

planned nationwide protests

against illegal clothing,

textile, footwear and leather

(CTFL) imports – giving

the South African Revenue

Service (Sars) leadership

a chance to meet with its

representatives next month

and agree on “concrete and

urgent solutions”.

Andre Kriel, general

secretary at the Cosatualigned

union, told FTW

that following its protest

march to Sars head office

in Pretoria earlier this

month (March 10), Sactwu

was planning to conduct a

further 18 protests at Sars

regional and branch offices

as well as at ports and other

entry points. “But now we

have the meeting on April

12,” he said.

Kriel said the union had

been in talks with Sars for 18

months, but that at quarterly

industry forum meetings the

revenue authority’s resolve

to fight the scourge of illegal

imports seemed to have

collapsed.

Sactwu researcher Simon

Eppel pointed to statistics

that seemingly illustrated

that the Sars campaign had

ceased to yield satisfactory

results. “Eight years ago,

Sars started a serious

campaign to combat illegal

imports in this sector. In

the first four years of the

campaign, the authority

confiscated more than R1.9

billion worth of illegally

imported goods in the CTFL

sector – about R485 million

per year.”

In the last three years,

however, Sars annual reports

indicated that it had only

seized R106 million worth of

CTFL goods – around R35

million a year, said Eppel.

“In the 2015/2016 financial

year we saw the nearcollapse

of this campaign

with only R8.7 million worth

of goods confiscated.”

Furthermore, he said, in

2014 about 40 to 50 samples

of suspicious clothing had

been sent to industry experts

each month. According to

Eppel, this dropped to an

average of 30 per month in

2015 and plummeted to an

average of two per month in

2016.

He estimates that South

Africa loses about R4 billion

a year in import duties

due to illicit imports. “If

these duties were collected,

they could have built

infrastructure or helped

manufacturing,” he said.

Kriel added that the Sars

customs fraud campaign

was a key part of the

government’s drive to

reindustrialise the country.

“If Sars does not do its job

properly, it undermines

everything else done to build

and grow industries and

factories,” he said.

Industrial Development

Corporation (IDC)

spokesperson, Mandla

Mpangase, agreed that

illegal and under-invoiced

imports remained a major

threat to the industry.

“The IDC welcomes the

interaction between

Sars and the industry,

as well as the resultant

recommendations to address

this challenge,” he said.

A Sars spokesperson

said the revenue authority

was committed to working

closely with industry

stakeholders, including

Sactwu, to seek new

solutions. “We are in the

process of reviewing and

modernising existing

customs and tax regulations

and the licensing of trading

entities and are looking at

a more effective penalty

regime to deter noncompliance,”

he said.

Sactwu has called on Sars

to, amongst others, increase

raids on internal customs

hotspots; implement

dedicated ports of entry for

CTFL goods; and fast-track

the implementation of the

new Customs Control and

Customs Duty Acts which

contain several provisions

to assist it in dealing more

effectively with customs

fraud.

CAPTION

The Sactwu march to Pretoria earlier this month, highlighting the number of jobs lost due to

illegal textile imports.