A. Value Added Tax/Sales Tax (National Goverment)
1. Name of Tax, Levied in Terms of Which Act (Name, Number and Year)
Value Added Tax, Value Added Tax Act (VAT), 89 of 1991.
2. Department Responsible for Administration
South African Revenue Service
3. Taxpayer
Under s 7 VAT is levied on all supplies made by registered vendors in the course or furtherance of their enterprises.
A vendor is defined in s 1 and means any person who is or is required to be registered for VAT.
- Registration as a vendor is compulsory where a person carries on any enterprise and the total value of taxable supplies made in a period of 12 months exceed R1000 000 million(s 23).
- A person can also voluntarily register as a vendor of the value of taxable supplies are less than R1000 000 million but exceed R20 000 per annum (s 23).
- Enterprises making taxable supplies of less than R20 000 per annum cannot register for VAT.
4. Time When Tax is Levied
Under s 9 Time of supply or importation.
- As a general rule, a supply of goods or services shall take place at the time the invoice is issued by the supplier or recipient or when payment is received, whichever time is earlier.
- Special time of supply rules may be applicable in certain circumstances.
5. Included in Tax Base
Under s 7
- The supply of goods or services by a vendor in the course or furtherance of his enterprise;
- The importation of goods in SA by any person; and
- The supply of imported services by any person
6. Positive Rates
The Act provides for two different rates, namely
- Under s 11 a zero rate; and
- Under s 7 (3) a standard rate of 14%.Note:
There are no higher or intermediate VAT rates in South Africa
7. List of Goods/Services at Zero Rate
Under s 11
The following goods and services are subject to VAT at the zero rate:
- Goods exported from South Africa;
- Brown bread;
- Brown wheaten meal;
- Maize meal;
- Samp;
- Mealie rice;
- Dried mealies;
- Dried beans;
- Rice;
- Lentils;
- Fruit and vegetables;
- Pilchards and sardinella in tins or cans;
- Milk, cultured milks and milk powder;
- Cooking oil;
- Eggs;
- Edible legumes, and pulse or leguminous plants;
- Dairy powder blends;
- Petrol, diesel and illuminating paraffin;
- Certain supplies made for farming, agricultural or pastoral purposes, provided certain requirements are met;
- Certain gold coins issued by the SA Reserve Bank (including Kruger Rands);
- International transport and related services;
- State subsidies and donations to welfare organisations;
- Transfer payments made by public authorities to vendors;
- Services supplied outside South Africa.A zero-rating implies that VAT at 0% is levied on supplies and consequently all VAT borne by the vendor for purposes of making such supplies is claimable as an input tax deduction.
8. List of Goods/Services at Positive Rates Other Than Standard
Not applicable for South Africa
9. List of Exemptions
Under s 12 the following goods and services are exempt from VAT:
- Financial services;
- Passenger transport by road and rail;
- The rental of residential accommodation;
- Educational services in crèches, nursery schools, primary and secondary schools, after school centres, universities and technikons.
- Interest, pension and life insurance benefits;
- Medical services and medicines supplied by the State and provincial hospitals and local authority clinics;
- The supply of goods or services by an employee organisation to its members to the extent that the consideration consists of membership contributions.
An exemption implies that the supplier does not levy VAT on the supply and consequently no input tax deduction in relation to the provision of such supplies is allowed.
10. Tax Period
Under s 27 vendors generally will have a one or two calendar month tax period, depending to some extent on the value of the taxable supplies. Consequently vendors are separated into categories A to E:
- Categories A and B - Ordinarily, a two month tax period is allocated to a vendor which may either be January, March etc or February, April etc;
- Category C - Where the total value of taxable supplies exceed R30 million for a 12 month period, or is likely to exceed R30 million, the vendor's tax period shall be one month
- Category D - Where the vendor's enterprise consists solely of agricultural, pastoral or other farming activities, and the value of the supplies does not exceed or is not likely to exceed R1 million, such vendor may apply in writing to have a six-monthly VAT period
- Category E - are vendors whose enterprise consists solely of rental income or administration or management fees received from connected persons who are all registered vendors. Such vendors are permitted to submit annual VAT returns.
Under s 28 VAT is payable by the 25th day of the month following the end of the tax period.
11. Deferement Schemes/Special Schemes
A limited deferment scheme for import VAT is in place.
A special scheme is in place for sugar cane farming co-operatives that allows calculation of input tax and self-billing of output tax by the principal.
No special VAT retail methods are in place at present but these are to be introduced during 2003.
12. Beneficiary of Revenue
National Government
B. Excise Taxes Alcohol (National Government)
1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)
Excise duties, Customs and Excise Act 91 of 1964.
2. Department Responsible for Administration
South African Revenue Service
3. Taxpayer
Importer/local manufacturer
4. Included in Tax Base
Excise duties apply to certain locally manufactured goods. Relief from excise duty is available where excisable products are exported. In addition, relief is also available in respect of farming, forestry and certain manufacturing activities.
5. Tax Rate (Tariff Heading, Description, Rate Per Litre or Per Litre of Absolute Alcohol)
Tariff item 104.10 22 Malt Beer:
2 563 cents (25 63 Rands) per litre of absolute alcohol
Tariff item 104.1505 Sorghum beer
7.82 cents per litre
Tariff item 104.1525 Spirits (local)
3337 cents (33.37 Rands) per litre of absolute alcohol
Tariff item 104.1570 Sparkling wine
227.6 cents per litre
Tariff item 104.1540 Fortified still wine
182.5 cents per litre
Tariff item 104.1510 Unfortified still wine
80.7 cents per litre
Tariff item 104.1550 Other still fermented beverages unfortified
130.5 cents per litre
Tariff item 104.1560 Other, still fermented beverages, fortified
231.4 cents per litre
Tariff item 104.2010 Wine spirits, manufactured in the Republic by the distillation of wine
3 671 cents (36.71 Rands) per litre of absolute alcohol
Tariff item 104.2015 Spirits, manufactured in SA by the distillation of any sugar cane product
3 671 cents (36.71 Rands) per litre of absolute alcohol
Tariff item 104.2023 Spirits manufactured in SA by the distillation of any grain product
3 671 cents (36.71 Rands) per litre of absolute alcohol
Tariff item 104.2029 Other spirits, manufactured in the Republic
3 671 cents (36.71 Rands) per litre of absolute alcohol
Tariff item 104.2060 Imported spirits of any nature.
3 575 cents (35.75. Rands) per litre of absolute alcohol or 1 537 cents (15.37 Rands) per litre
Tariff item 104.2070 Spirits of whatever nature in imported liqueurs, cordials and similar spirituous beverages.
3 575 cents (35.75 Rands) per litre of absolute alcohol
Note: Alcoholic Fruit Beverages (AFB's) and ciders are charged at the rate applicable to “other still fermented unfortified”
Spirit coolers are charged at the rate applicable to spirits
6. Rebates
The duty is intended to tax potable (i.e. for human consumption) alcohol. Alcohol used for other purposes such as intermediate products in manufacture or for medical purposes, is not intended to fall within the scope of the duty. However to protect the revenue all alcohols are liable to duty and rebates are given to non-potable alcohol used for (approved) purposes. De-naturants are added to alcohol intended for commercial purposes to deter illicit consumption.
7. Beneficiary of Revenue
National Government
C. Excise Taxes Tobacco Products (National Government)
1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)
Excise duties, Customs and Excise Act 91 of 1964.
2. Department Responsible for Administration
South African Revenue Service
3. Taxpayer
Importer/local manufacturer
4. Included in Tax Base
Excise duties apply to certain locally manufactured goods. Relief from excise duty is available where excisable products are exported.
5. Tax Rate (Tariff Heading, Description, Rate Per Kilogramme, or Per 10 cigarettes/Cigars)
Tariff item104.3020 Cigarettes 175.4 cents per 10 cigarettesTariff item104.3510 Cigarette tobacco (hand rolling) 10 297 cents (102.97 Rands) per KG Tariff item104.3010 Cigars 76 670 cents (766.70 Rands) per KG Tariff item104.3520 Pipe tobacco 5 251 cents ( 52.51 Rands) per KG
6. Rebates
None in South Africa
7. Beneficiary of Revenue
National Government
D. Excise Taxes Fuel/Hydrocarbon Oils (National Government)
1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)
This tax is collected as a “Road Fuel Levy” in South Africa: Fuel Levy, Customs and Excise Act 91 of 1964
2. Department Responsible for Administration
South African Revenue Services
3. Taxpayer
Refiner
4. Included in Tax Base
Under s 47 the indirect tax on fuel consists of four components:
1. The Fuel Levy - which accrues to the National Revenue Fund;
2. The Road Accident Fund Levy - which is dedicated to meeting the claims from victims of road accidents;
3. A Customs and Excise levy - which forms part of the South African Customs Union (SACU) customs pool;
4. An Equalization fund Levy - the proceeds of which have been used in the past to smooth the monthly fluctuations in the domestic fuel price due to changes in international crude oil prices (not used in 2000/2001)
Note: A small additional levy has been imposed on diesel sales since 2001 to fund the marking and dyeing of illuminating paraffin to combat the illegal mixing of diesel and illuminating paraffin.
5. Tax Rate (Rate of Duty Per Litre, Total Tax Burden as a Percentage of Retail Price)
Under s 7
Leaded petrol
General fuel levy 98
Road Accident Fund Levy 16.5
Customs and Excise SACU 4.0
Equalization Fund N/A
Illuminating paraffin marker N/A
Total tax element 105.5
Retail price 401.0
Taxes as a percentage of retail price 29.6%
Unleaded Petrol
General fuel levy 94.8
Road Accident Fund Levy 16.5
Customs and Excise SACU 4.0
Equalization Fund N/A
Illuminating paraffin marker N/A
Total tax element
Retail price
Taxes as a percentage of retail price
Diesel
General fuel levy 81
Road Accident Fund Levy 16.5
Customs and Excise SACU 4.0
Equalization Fund N/A
Illuminating paraffin marker 0.2
Total tax element 101.7
Retail price 347.0
Taxes as a percentage of retail price 29.3%
6. Rebates/Concessions/Special Schemes
A rebate scheme is in place to allow some exceptions including farmers involved in primary production and use in sea going vessels.
To deter misuse of illuminating paraffin as a mixer with diesel fuel, a chemical marker is added to paraffin and the administrator (SARS) undertakes a fuel-testing programme to deter and detect misuse.
A beneficial duty rate is applied to unleaded petrol to encourage transition from leaded.
A beneficial duty rate is to be applied to the production of “Bio” diesel (fuel from renewable resources) as from 2003.
7. Beneficiary of Revenue
National Government
E. Excise Taxes - Non Alcoholic Bevarages/Other (National Government)
1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)
Excise duties, Customs and Excise Act, 91 of 1964
2. Department Responsible for Administration
South African Revenue Services
3. Taxpayer
Importer/local manufacturer
4. Included in Tax Base
Waters including natural or artificial mineral waters and aerated waters, not containing added sugar or other sweetening matter nor flavoured; ice and snow waters, including mineral waters, containing added sugar or other sweetening matter or flavoured and other non-alcoholic beverages (excluding fruit or vegetable juices of heading no 20.09)
5. Tax Rate (Tariff Heading, Rate Per Litre, or Per Kilogramme, or Per Unit)
Tariff item104.0510 Mineral waters, including spa waters and aerated waters, put up in closed bottles or other closed containers ready for drinking without dilution (excluding beverages packed in plastic tubes or similar containers and which are normally consumed in a frozen state): 6c/l
Tariff item104.0520 Lemonade and flavoured mineral waters, including flavoured spa and aerated waters, put up in closed bottles or other closed containers ready for drinking without dilution (excluding beverages packed in plastic tubes or similar containers and which are normally consumed in a frozen state): 6c/l
Tariff item104.0530 Non-alcoholic beverages not elsewhere specified or included in this tariff item, put up in closed bottles or closed containers ready for drinking without dilution (excluding beverages packed in plastic tubes or similar containers and which are normally consumed in a frozen state): 6c/l
Note: The duty on the above has been reduced to nil as announced in the 2002 budget review
6. Rebates
None
7. Beneficiary of Revenue
National Government
F. Excise Duty on Luxury Goods - Ad Valorem (National Government)
1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)
Ad valorem excise duty, Customs and Excise Act 91 of 1964
2. Department Responsible for Administration
South African Revenue Service
3. Taxpayer
The importer/local manufacturer
4. Included in Tax Base
Excise duty is ad valorem duty on luxury goods such as motor vehicles, cosmetics, computers, televisions and audio equipment. The duty is chargeable on value of finished goods and is collected from the manufacturer or importer.
5. Tax Rate
Gaming machines, photocopying equipment, printing, vending and office machines (including computers, fax machines and modems) and TV sets 5%
Motorcycles (200-800cc) 5%
Clocks, firearms, motorcycles (greater than 800cc), photographic film 7%
Haircare products, perfumes, skincare products, cosmetics and toiletries 7%
Video equipment, hi-fi equipment, optical lenses, photographic/cinematographic equipment, pre-recorded tapes and compact discs 7%
Motor vehicles (sliding scale) Max 8%
6. Special Methods (to deal with the specific needs of some industries)
Where the value of the “finished” goods is not readily determinable such as where a local manufacturer has an ”integrated structure”, reductions from the wholesale or retail price are calculated based on an agreed “value determination” process to establish a fair taxable value.
For the motorcar industry a special formula to take account of the variety of products is in place.
7. Beneficiary of Revenue
National Government
G. Excise Duty on Other Goods (National Government)
1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)
2. Department Responsible for Administration
3. Taxpayer
4. Included in Tax Base
5. Tax Rate (specify ad valorem or specific)
6. Special Methods (to deal with the specific needs of some industries)
7. Beneficiary of Revenue
H. Air Passenger Duty/ Departure Tax (National Government)
1. Name of Tax Levied in Terms of Which Act (Name, Number and Year)
Air Passenger Duty: Customs and Excise Act 91 of 1964
2. Department Responsible for Administration
The tax is collected by operators (Airlines) and agents (those acting on behalf of operators) whom are required to then pay it over to SARS.
3. Taxpayer
Passengers on international flights and those departing to the BLNS countries (Botswana, Lesotho, Namibia and Swaziland).
4. Included in Tax Base
A tax of R100 per fee-paying passenger departing in international flights and R50 per passenger departing to the BLNS countries is payable from 1 November 2000.
5. Tax Rate
A tax of R100 per fee-paying passenger departing in international flights and R50 per passenger departing to the BLNS countries (Botswana, Lesotho, Namibia and Swaziland) is payable from 1 November 2000.
6. Exemptions
Military personnel and aircrew returning from duty outside South Africa.
7. Beneficiary of Revenue
National Government
I. Financial Transaction Taxes/Stamp Duty (National Government)
1. Name of Tax and Levied in Terms of Which Act (Name, Number and Year
Stamp Duty, Stamp Duty Act 77 of 1968
Marketable Securities Tax (MST) Marketable Securities Tax Act 32 of 1948 (MST Act)Uncertified Securities Tax (UST), Uncertified Securities Tax Act 31 of 1998 (UST Act)
2. Department Responsible for Administration
Commissioner for SARS (s2 of the Stamp Duties Act).
3. Taxpayer
- In general, the holder of the instrument (Stamp Duties)
- Every member (i.e. any person admitted as a member of a stock exchange) (s4, MST Act)The issuer (s 7 UST act).
4. Included in Tax Base
Every instrument as described in Schedule 1, not being an instrument in respect of which an exemption is provided for in the Stamp Duties Act or in the Schedule, shall be subject to the duties prescribed in the Schedule if the instrument is executed in the Republic or if the instrument is executed outside the Republic and relates to the transfer or hypothecation of any property situated in the Republic or to any matter or thing to be performed or done therein (s3 Stamp Duties Act).
MST is payable in respect of every purchase of marketable securities by a stockbroker on behalf of any person at a rate of 0.25% of the consideration for which such securities are purchased (s 2, MST Act). UST is payable in respect of the issue of, or change in beneficial ownership in any securities which are transferable without a written instrument and are not evidenced by a certificate. It is levied at a rate of 0.25% and will eventually replace MST (s 2 UST Act).
5. Tax Rate
Stamp duty is levied at the rates indicated:
Debit entries: For every debit entry posted to a cheque or credit card or any other account from which a payment or electronic transfer may be made to another account 20 cents
Mortgage bonds: Any mortgage bond hypothecating immovable property for every R100 or part thereof 20 cents
Fixed deposit receipts: For every R200 or part thereof for every period of 12 months or part thereof 10 cents
Instalment credit agreements, where the amount (inclusive of interest and Finance or other costs)
Does not exceed R5 000 R2 Exceed R5 000 but not R10 00 R4
Exceeds R10 000 but not R20 000 R8 Exceeds R20 000 but not R40 000 R16 Exceeds R40 000 but not R60 000 R24 Exceeds R60 000 but not R80 000 R32 Exceeds R80 000 but not R100 000 R40 Exceeds R100 000 but not R130 000 R50 Exceeds R130 000 but not R150 000 R60 Exceeds R150 000 but not R180 000 R70 Exceeds R180 000 but not R200 000 R80 Exceeds R200 000 R100
Leases of immovable property
For every R100 or part thereof of aggregate rent and any other consideration
Period not exceeding 5 years 25 cents
Period exceeding 5 years but not 10 years 40 cents Period exceeding 10 years but not 20 years 55 cents Period exceeding 20 years 70 cents
Marketable securities
Original issue for every R20 or part thereof, the nominal value and any premium payable therefore (if transferable only by registration) 5 cents
If made out to bearer for every R20 or part thereof the nominal value and any premium payable therefore 20 cents
Registration of transfer (other than through a stock broker) For every R10 or part thereof, of the amount or value of the consideration given, or where no consideration is given, the value of the marketable security transferred 2.5 cents
Policy of life insurance
For every R100 or part thereof of the aggregate sum assured 5 cents MST: 0.25% of the consideration (s2 MST Act)
UST: 0.25% of the consideration (s2 UST Act)
6. Exemptions
Certain security transactions
7. Beneficiary of Revenue
National Government
J. Payroll Taxes/Social Security Taxes (National Government)
1. Name of Tax and Levied in Terms of Which Act (Name, Number and Year
Unemployment Insurance Contributions, Unemployment Insurance Contributions Act 4 of 2002 (hereafter the UIC Act)Unemployment Insurance, Unemployment Insurance Act 63 of 2001Skills Development Levy, Skills Development Levy Act 97 of 1998
2. Department Responsible for Administration
UIF: South African Revenue Services (s 3);
SDL: Director-General of Labour (s2)
3. Taxpayer
UIF: Every employer and every employee as defined in s1 of the UIC Act)
SDL: Every employer as defined in s1 (i.e. employers who are registered with SARS for employees tax purposes or employers who have an annual payroll in excess of R250 000.
4. Included in Tax Base
UIF: Remuneration, meaning any amount of income that is paid or payable to any person whether in cash or otherwise and whether or not in respect of services rendered as applicable for PAYE purposes (definition of remuneration in s1 of the UIC Act).
SDL: The “leviable amount” as per s 3(4) meaning the total remuneration paid or payable by an employer to his employees during any month as determined in accordance with the provisions of the Fourth Schedule of the Act for purposes of determining the employer's liability for any employee's tax in terms of that Schedule.
5. Tax Rate
UIF:
Payable by an employee: 1% of the remuneration paid or payable to that employee
Payable by an employer: 1% of the remuneration paid to each employee (s6)
A cap may be determined from time to time by the Minister of Finance in respect of the remuneration paid on which the contribution is payable.
Currently the cap is set at R8 099 per month in other words a 2% contribution is levied on the first R8 099 paid or payable to an employee during a month.
SDL: From 1 April 2000: 0.5% of the leviable amount (s3 (1)(a));
From 1 April 2001:1% of the leviable amount (s3 (1)(b)).
The levy is deductible for income tax purposes and employers providing training to employees receive grants in terms of this scheme.
6. Exemptions
Government employees from UIF.
7. Beneficiary of Revenue
National Government
K. Other Taxes (National Government)
1. Name of Tax and Levied in Terms of Which Act (Name, Number and Year
Transfer duties, Transfer Duty Act, 40 of 1949
2. Department Responsible for Administration
Transfer duties: Commissioner for SARS (s10)
3. Taxpayer
Transfer duties: The person who has acquired property or in whose favour or for whose benefit any interest in or restriction upon the use of property has been renounced (s3).
4. Included in Tax Base
Transfer duties: The value of any property (s2) acquired by any person or the amount by which the value of any property is enhanced by the renunciation, of an interest in or restriction upon the use or disposal of that property.
5. Tax Rate
Transfer duty is levied at a rate of:
- 10% of the said value or the said amount as the case may be, if the person is a person other than a natural person; or on a sliding scale (for natural persons) as follows:
- 1% of the said value or amount, as does not exceed R70 000; and
- 5% of the said value or amount, as exceeds R70 000 but does not exceed R250 000; and
- 8% of the said value or amount, as exceeds R250 000 (s2).
It is proposed to adjust the transfer duty rate as set out below for property acquired on or after 1 March 2002:
On the first R100 000 of purchase consideration 0%
On the amount that exceeds R100 001 but not R300 000 5%
On the amount that exceeds R300 001 8%
6. Exemptions/Rebates/Deferments/Special Schemes
Not payable by VAT registered vendors.
7. Beneficiary of Revenue
National Government/revenue fund
L. Other Taxes 2 (National Government)
1. Name of Tax and Levied in Terms of Which Act (Name, Number and Year
None for South Africa
2. Department Responsible for Administration
3. Taxpayer
4. Included in Tax Base
5. Tax Rate
6. Exemptions/Rebates/Deferments/Special Schemes
7. Beneficiary of Revenue