Tariffs, taxes and exchange control

TARIFFS AND TAXES Tariffs As a result of its market access offer for the Uruguay Round, South Africa has significantly reduced its number of tariff lines and bound most to WTO binding levels. It has cut back tariff lines from the 80 different levels of the past to eight levels ranging from zero to 30% with a few exceptions- notably in clothing and textiles and motor industry manufacturers. The general trend has been for tariffs to be reduced to encourage industries to become more competitive and also to reduce cost structures. Additional information on import policy and tariffs can be obtained from the : Department of Trade and Industry Board on Tariffs and Trade, Private Bag X753, Pretoria, 0001 Tel: +27 12 428-77021 Ms N J Mxkato-Diseko Customs Valuation The dutiable value of goods imported into South Africa is calculated on the F.O.B. price in the country of export, in accordance with the GATT Customs Valuation Code. The value for customs duty purposes is the transaction value - the price actually paid or payable. In cases where the transaction value cannot be ascertained, the price actually paid for similar goods, adjusted for differences in cost and charges based on distance and mode of transport, is regarded as the transaction value. If more than one transaction value is ascertained, the lowest value applies. Alternatively, a computed value may be used based on production costs of the imported goods. In the case of related buyers and sellers, the transaction value will be accepted if, in the opinion of the Commissioner for Customs and Excise, the relationship does not influence the price, or if the importer shows that the transaction value approximates to the value of identical or similar goods imported at or about the same time. Dutiable weight for the assessment of specific duties is the legal weight of the merchandise, plus the weight of the immediate container in which the product is sold, unless specified otherwise in the tariff. Cargo Info Africa provides a comprehensive service for trade into Africa including the SA Customs' Tariff Book. Click here for their site Value Added Tax The value-added tax (VAT) is 14 percent. VAT is payable on nearly all imports. However, goods imported for use in manufacturing or resale by registered traders may be exempt from VAT. Excise Tax Specific excise duties are levied on alcoholic and nonalcoholic beverages, tobacco and tobacco products, and petroleum products. Ad valorem excise duties are levied on a range of "up market" consumer goods. The current statutory (2001) rate is 10% except that most office machinery, as well as motorcycles, have a duty at 5%. Tariff Rebates Various provisions for rebate of duty exist for specific materials used in domestic manufacturing. The importer must consult the relevant schedules to the Customs and Excise Act to determine whether the potential imports are eligible for rebate of duty. EXCHANGE CONTROLS The South African government aims to ultimatley remove all exchange controls and has already reduced many over several years. Since 1994 significant progress has been achieved, including the elimination of the financial Rand in March 1995; the lifting of exchange control on investments by individuals up to R200,000; and the increasingly large offshore investments corporations have been allowed to make. Exchange controls are currently administered by the South African Reserve Bank (SARB)'s Exchange Control Department through commercial banks that are authorised to deal in foreign exchange. All international commercial transactions must be accounted for through these authorised foreign exchange dealers. Click here for a list of authorized dealers in foreign exchange. Click here for The SARB Exchange Control Manual. Currency The currency unit is the Rand (ZAR), denoted by the symbol R1. R1=100 cents. South Africa has recently introduced new notes and coins, but the old currency is still in circulation.