Customs duty changes on various products

The Customs duty increase investigations on products listed below were initiated by the International Trade Administration Commission  (ITAC) during the course of 2019 and 2018, however, no outcome has been made public yet.

The products

Product name Initiated Current duty Duty requested
Acrylic resins 21 Sep2018 0% and 10% 15%
Combined refrigerator-freezer 28 Sep2018 25% 30%
Chicken meat 30 Nov 2018 12% and 37% 82% (Granted)
Coated Steel review 23 Aug 2019 Various Unknown
Certain coated or plated flat rolled steel 21 Jun 2019 0% 10%
Rolled aluminium 29 Mar 2019 0% 15%
Mixtures of frozen vegetables 22 Feb 2019 10% 37%
Crystalline silicon photovoltaic modules 29 Mar 2019 0% 10%
Fully automatic top loader washing machines 29 Mar 2019 0% 30% (Granted)
Polyethylene terephthalate (PET) 28 Apr 2019 0% 5% (Granted)
Phosphoric acid 16 Feb 2018 0% 10%

Why should you be concerned?

Given the time that has elapsed since the initiation of each of the investigations, it is best to assume that finalisation is imminent or has already been finalised but going through the normal administrative implementation processes.

It is vital to minimise the risk of being suddenly caught up with a large duty liability by pre-clearing imports of the above-mentioned products, provided the tariff code you clear the product under is covered in the ITAC investigation.

Should a duty come into force, it is typically published in the Government Gazette (GG) on a Friday and implemented on the same day. This means SARS will start collecting the relevant duty on the same day. If the duty increase was rejected, no GG is published in the matter. ITAC will simply make its investigation report public.

Possible outcomes in a duty increase investigation

There are likely two possible outcomes were a duty increase is concerned; either the duty is increased to some level (which might not necessarily be the level requested by the applicant) or rejected entirely.

The outcome of course depends on the findings of the ITAC investigation. It’s not always possible to say the exact outcome before a final ITAC report or Government Gazette (GG) is made public, whichever is made public first. if you are an importer of the listed products, it’s best to assume an upward revision of duty until the outcome says otherwise.

A bit of insight

The duty increases requested by the applicants in all of the above products are the maximum duties permissible (also known as the bound rate) without violating South Africa’s WTO duty or tariff commitments agreed to in 1994.

It is further interesting to note that 50% of the above products are currently duty-free, meaning there is currently no duty protection at all. More than 50% of the products are intermediate industrial products. A duty increase may possibly have cost implications for downstream manufacturers, however, this depends on how large the increase is.

If you want to see how we can help you with a duty increase, duty removal, temporary, or industrial rebate click here

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