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SARS Customs Duties And VAT

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SARS Customs Duties And VAT

Customs duties are imposed by the Customs and Excise Act 91 of 1964. They are levied on imported goods with the aim of raising revenue and protecting the local market. They are usually calculated as a percentage of the value of the goods (set in the schedules to the Customs and Excise Act). However meat, fish, tea, certain textile products and certain firearms attract rates of duty calculated either as a percentage of the value or as cents per unit (for example, per kilogram or metre).

Additional ad valorem excise duties are levied on a wide range of luxury or non-essential items such as perfumes, firearms and arcade games. See the External Standard – Ad Valorem Excise Duty.

What’s New?

  • 17 February 2016 – Reminder of 13th deferment payment at the end of the Financial Year 2015/6Customs Clients who are deferment account holders need to adhere to the 13th deferment payment requirements which becomes due by each financial year end.The Customs Deferment document (SC-DT-B-02) effective 27 November 2015 stipulates that, in addition to the twelve (12) regular payment dates chosen by the client, there will be a thirteenth payment in March every year.

    Therefore, the statement period for this financial year (2015/2016) thirteenth payment will close on the 28th March 2016 at midnight (00.00) and payment must be made by 15h00 on the 30th March 2016. The e-statements will be available as at 00h01 on 29th March 2016 for Account Holders who are on eFiling, whereas Account Holders not on eFiling are advised to make prior arrangement to collect statements at the respective Customs Branch Offices.

    In the event that any deferment account holder has difficulty in meeting this arrangement, you are advised to submit your written motivation for consideration to the Acting Group Executive, Mr. Mohamed Ally at by Tuesday 15 March 2016. Each of these cases will be considered on its own merits and for exceptional circumstances only.

    Furthermore, stakeholders are advised, specifically in cases where their bank does not transfer direct payments immediately, that they should ensure that payments are made sufficiently in advance in order to meet the payment deadline as above.

  • 12 October 2015 – Enhanced Customs Statement of Account and eFiling payment process

    As from 12 October 2015 SARS is introducing the first phase of improvements to the Customs account management and payment processes. This phase is aimed at enhancing the Customs Statement of Account (CSA) and the eFiling payment process, initiated via the CSA. For more info, see the letter sent to Trade  and the Customs Statement of Account Guide. To see an example of the new CSA, click here.

What duties are levied on imported goods?

Three kinds of duties are levied on imported goods:
  • Customs duties (including additional ad valorem duties on certain luxury or non-essential items)
  • Anti-dumping and countervailing duties
  • VAT (which is also collected on goods imported and cleared for home consumption).
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Anti-dumping and countervailing duty

Anti-dumping and countervailing duties are levied:
• On goods considered to be “dumped” in South Africa; and
• On subsidised imported goods.
These goods are the subject of investigations into pricing and export incentives in the country of origin; the rate imposed will depend on the result of the investigations. These duties are either levied on an ad valorem basis (as a percentage of the value of the goods) or as a specific duty (as cents per unit).
The amount and type of duty imposed on a product is determined by the following main criteria:
  • The value of the goods (the customs value)
  • The volume or quantity of the goods
  • The tariff classification of the goods (the tariff heading).

How is VAT calculated on imported goods?

The VAT rate in South Africa is currently 14%
To calculate VAT on imported goods, the ATV (added tax value) needs to be determined first.

This is done as follows:

[(Customs Value + 10% thereof) + (any non-rebated duties levied on the goods)] x 14%
= [ATV] x 14%
= VAT payable

  • The 10% mark-up on the customs value in this calculation is applicable when goods are imported from a country outside the Customs Union. Therefore, if goods have their origin in any of the BLNS countries (Botswana, Lesotho, Namibia or Swaziland), the 10% will not be added to the calculation.
  • When goods are exported to any of the BLNS countries, the same applies (no mark-up on the customs value to determine ATV).