7 September 2018 by Tax & Exchange Control Alert

Customs & Excise Highlights

This week’s selected highlights in the Customs & Excise environment since our last instalment.

  1. Draft amendments for implementation on 1 January 2019 (certain sections quoted from the SARS website):

1.1    The phase–down of duties in terms of the Economic Partnership Agreement (EPA) between the European Union and the Southern African Development Community EPA States, which relates to the following:

1.1.1   Fish classifiable in tariff subheadings 0302.13, 0302.14, 0303.14 and 0305.41, in Section A, Annex II, listed as staging category “B” shall be reduced to a preference margin of 33 per cent of the most favoured nation (MFN) rate of duty; and

1.1.2   Fish in Chapters 3 and 16, in Section A, Annex II, listed as staging category “C” shall be reduced to a preference margin of 60 per cent of the MFN rate of duty.

1.2    Technical amendment to the Schedules of the Customs & Excise Act, No 91 of 1964 (Act):

1.2.1   Amendments of Schedule 1 Part 1:

1.2.1.1    Requests from the South African Sugar Association for the creation of separate tariff subheadings to provide for liquid sugars (tariff subheading 1702.90);

1.2.1.2    Requests from the Department of Environmental Affairs for the creation of separate tariff subheadings for substances that contribute to the depletion of the ozone layer that result in global warming (tariff subheading 3824.7);

1.2.1.3    Request from Propet S.A (Pty) Ltd for the creation of new tariff subheadings for Polyethylene Terephthalate Strapping classifiable in tariff subheading 3920.62.10;

1.2.1.4    Request from Propet S.A (Pty) Ltd for the creation of new tariff subheadings for Polyethylene Terephthalate Monofilament classifiable in tariff subheading 5404.19;

1.2.1.5    Request from Hanes Inc. for the creation of separate tariff subheadings for brassieres classifiable in tariff subheading 6212.12;

1.2.1.6    Request from the South African Footwear and Leather Industries Association for the creation of separate tariff subheadings for safety footwear classifiable in Chapter 64;

1.2.1.7    Request from the Southern African Metal Cladding and Roofing Association for the creation of new tariff subheadings in Chapter 72 (tariff subheadings 7210.41, 7210.49, 7210.61, 7210.70, 7210.90 and 7225.92);

1.2.1.8    Request for the creation of new tariff subheadings for copper coated wire that is used in the welding industry, classified in tariff subheadings 7217.30 and 7229.90; 

1.2.1.9    Request from Harvey Roofing Products (Pty) Ltd for the creation of new tariff subheadings for steel roofing tiles, classifiable in tariff subheading 7308.90.90; 

1.2.1.10  Request from Defy for the creation of 8-digit tariff subheadings on washing machines (tariff subheading 8450.20);

1.2.1.11  Request from the Non-Ferrous Metals Industry Association for the creation of 8-digit tariff subheadings on scrap lead acid batteries as well as on lead acid, of a kind used for starting piston engines (tariff subheading 8548.10);

1.2.2     Amendments of Schedule 1 Part 2A:

1.2.2.1    Deletions as a consequence to the above amendments to Schedule 1 Part 1;

1.2.3     Amendment of Schedule 3:

1.2.3.1    Rebate item 315.05/7308.90.90/01.01 is being deleted as a consequence to a deletion of Schedule 1 Part 1 and rebate item 315.05/7308.90.99/01.01 is inserted;

1.2.4     Amendment of Schedule 4:

1.2.4.1    Rebate item 460.02/12.06/01.04 provides for sunflower seed, in such quantities as the Director-General: Department of Agriculture, Forestry and Fisheries, may allow by specific permit issued on or before 10 May 2002. The rebate provision is deleted as it was created for goods entered for home consumption on or before 10 May 2002.

1.2.4.2    Rebate item 460.07/39.19/01.04 provides for plates, sheets, film, foil and strip, of polyethylene terephthalates, self-adhesive, with removable protective substances, entered on or before 12 April 1997, in such quantities and subject to such conditions as the International Trade Administration Commission, may allow by specific permit issued on or before 12 April 1996. The rebate provision is deleted as it was created for goods entered for home consumption on or before 12 April 1997.

1.2.5     Amendment of Schedule 5:

1.2.5.1    Deletion of Note 1 to rebate item 537.00 applicable to MIDP and Note 2 is renumbered as Note 1, to remove the reference to rebate item 317.04 applicable to MIDP;

1.2.5.2    Deletion of refund items 537.01, 537.01/8701.20/01.06, 537.01/87.02/01.04, 537.01/87.03/01.04, 537.01/87.04/01.04 and 537.01/87.06/01.04, as they were applicable to MIDP; and 

1.2.5.3    Deletion of refund item 538.00/00.00/02.00 applicable to MIDP. 

Comments can be submitted to: MMaphosa@sars.gov.za and AMpanza@sars.gov.za by 1 October 2018.

  1. Amendments to the Schedules to the Act:

2.1    Schedule 1 Part 1:

2.1.1     The substitution of tariff subheadings 1001.91 and 1001.99 as well as 1101.00.10 and 1101.00.90 to increase the rate of customs duty on wheat and wheaten flour from 28,17c/kg and 42,26c/kg to 64,06c/kg and 96,09c/kg respectively;

2.2    Schedule 2:

2.2.1     The substitution of safeguard items 260.03/72.08/01.04 and 260.03/7225.40/01.06 to exclude rebate items 460.15/7208.51/01.06 and 460.15/7225.40/19.06 in order to exclude certain hot-rolled carbon steel plates from being subject to safeguard duty (with effect from 31 August 2018 up to and including 10 August 2019);

2.2.2     The substitution of safeguard items 260.03/72.08/01.04 and 260.03/7225.40/01.06 to exclude rebate items 460.15/7208.51/01.06 and 460.15/7225.40/19.06 in order to exclude certain hot-rolled carbon steel plates from being subject to safeguard duty (with effect from 11 August 2019 up to and including 10 August 2020);

2.3    Schedule 4:

2.3.1     The insertion of rebate item 460.16/8523.52.10/01.08 in order to create a temporary rebate facility on digital smart cards (excluding proximity cards and tags) classifiable in tariff subheading 8523.52.10; and

2.3.2     The insertion of rebate item 460.15/7208.51/01.06 and 460.15/7225.40/19.06 in order to create a rebate facility on certain hot-rolled carbon steel plates classifiable in tariff subheading 720851 and 7225.40 – ITAC Report 585 (31 August 2018).

  1. Draft amendments relating to spirits/fortified wine/unfortified wine received and used under rebate of duty in terms of item 620.25/104.15:

3.1    The insertion of Note 7 as well as rebate items 620.25/104.15, 620.25/104.15.21/01.01 and 620.25/104.15.23/02.01 to provide for the rebate provision on unfortified wine used in the manufacture of other foodstuffs; and

3.2    Draft Rule inserting form DA 133 – Return in respect of spirits/fortified wine/unfortified wine received and used under rebate of duty.

Due date for comments is 18 September 2018 as follows:

                For the draft amendment to Schedule No. 6: mmaphosa@sars.gov.za; and
                For the draft rule inserting form DA 133: C&E_legislativecomments@sars.gov.za. 

  1. The International Trade Administration Commission has (certain sections quoted from the notice) issued a notice of termination of an investigation into the alleged dumping of detonating fuses and delay detonators (commonly known as shock tubes), originating in or imported from the People’s Republic of China. Enquiries may be directed to Ms Carina van Vuuren at telephone (012) 394 3594.

  2. A notice in terms of s38(1) of the Legal Metrology Act, No 9 of 2014 was published in the Government Gazette on 24 August 2018 by the Department of Trade and Industry. It relates to prescribed measuring equipment and provides (inter alia) as follows:

“Any manufacturer, importer or person who offer[s] for sale or supply any prescribed measuring instrument, product, or provides a service, falling within the ambit of the Act prior to the date of these regulations coming into effect, must apply for registration with the National Regulator within three years from the date of these regulations coming into effect”.

  1. Please advise if additional information is required.
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