Article by Quintus van der Merwe and Tarryn Hunkin
Importers of containerised cargo will find themselves paying more customs duties and VAT following amendments to the Customs and Excise Act 91 of 1964 which became effective on 1 October 2009.
Quintus van der Merwe, and Tarryn Hunkin of Customs@Wylie point out that the amendments to sections 66 and 67 will impact on the amount of customs duties and VAT paid by importers, thus increasing revenue collection.
Prior to the amendment, section 66(11)(a) defined the port or place of export as the place where the goods were packed into a container. This section now states that the port or place of export is that point where the goods are placed on board ship or on any vehicle which conveys them from or across the border of that country. It deletes the reference to the point of packaging into a container.
For non-containerised or break-bulk cargo the port or place of export was, and remains where the goods are placed on board a ship or on any vehicle which transported them across the border of that country.
The amendment therefore, removes the distinction between containerised and non-containerised cargo. The effect of this is that in future break-bulk and containerised cargo will be valued at the same point, namely where such goods are placed onto the ship or any vehicle which conveys them from the country of export.
In other words, all costs incurred prior to loading the container onto a ship or vehicle for export will have to be added to the price actually payable and only the costs incurred after the goods have been loaded onto the mode of conveyance will be allowable as a deduction.
This does mean that goods that are moved from a landlocked country of export to another country for shipping will be valued differently. There is no doubt going to be some debate as to what is meant by being "loaded onto a ship or vehicle for export..."
It would seem that packing, handling, inland freight (except where the goods are removed from the country of export by road) are no longer deductible costs.
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