SARS denies that consignee pays duty on the value of the goods as well as the VAT
CONGESTION AT border posts and additional costs having to be paid on standard rated goods as a result of the imposition of VAT on cargo into and out of the BLNS countries by South African authorities has brought howls of rage from road transport operators and importers.
Currently up to 70 trucks a day are being held up at Grobler's Bridge, the entry point into the country from Botswana near the North West Province centre of Ellisras. At other posts transport operators are protesting against what they claim is duty having to be paid on VAT amounts, in addition to those imposed on the value of the goods.
The imposition of VAT on BLNS goods entering South Africa was introduced on January 1, following decisions taken by the South African Revenue Services (SARS) last November, when these were initially imposed only on consignments leaving the country at these posts.
But, says Robert Sandla, SARS g.m. for border control policy formulation, the customs and excise officials at border posts throughout the country are merely invoking a law which has been in existence for a long time, but which has not been carried out until now.
What South Africa is doing should not be conceived as biased treatment, he says. Vendors are faced with two options. If they are going to deliver to an export destination, their goods are zero rated. If they are selling to an export purchaser, they are charged at standard rates, and VAT must then apply.
This is where exporters from neighbouring countries have raised the objection, claiming the consignee ends up paying duty not only on the value of the goods but also on VAT.
Not so, says Sandla. The SARS levies import duty on the supplier's invoice. VAT is based on customs value, which is inflated by 10% on imports. It's something we've been doing for a long time. It's nothing new.
The problem at Grobler's Bridge, also known as Martins Drift, is an individual one, and it stretches beyond mere customs duty collections, says Sandla.
This is a comparatively new entry point on our schedule and one which we began to notice seriously towards the end of last year, he said.
What has been happening there is that without proper controls in the past, vehicles were able to get through, often escaping the imposition of any level of customs duty.
Transport operators found they could avoid Beit Bridge and its more rigid controls by going the Botswana route with goods from Zambia and the Congo. The extra travelling involved them in as much as R3000 on a single trip, but when a single container could be duty rated at R5000 or
more, it was worth it.
What really brought matters to a head was the discovery that some of the so-called cargo was human. You recall the incident in that region when dead bodies of illegal immigrants were discovered. This is what appears to have been happening. Now this post, along with around 16 others of a similar nature, is more tightly controlled, and the trucks expecting to be able to slip through find their paths blocked.
Getting everything into shipshape order from the outset is proving a major problem, however, according to Sandla.
We appeal to all traders to bear with us. SARS does guarantee a maximum of a three-hour delay at border posts, but when there is need for more thorough inspection of a consignment, or we are suspicious of the nature of the goods, you must expect hold-ups.
We have had our share of teething problems in this take-over period. The terrain at many border posts is rough and we do not have full facilities at all of them as yet. We are giving proper training to our officers out there and have made appointments at fairly high levels.
We will soon have it all going to order. We have advised all stakeholders extensively of what we are doing and what we expect of them.
BY LEONARD NEILL
