New import fees come into effect

Picture courtesy: (RMI) New Import duties by SARS are now into effect as of July 1, 2024.

(The Post News)- New import fees come into effect as of today, Monday, July 1. South Africans who regularly shop online for small-ticket items will face higher costs.

Whether buying a trendy outfit from Shein, Temu, or a tech gadget from an international e-commerce platform, the newly increased 45% VAT will impact their wallets.

The South African Revenue Services (SARS) and Customs will alter the handling system for small orders that enter the country.

All orders that are R500 and less are now subject to a 45% import fee plus VAT, the same as large orders.

Previously, orders valued at R500 or less enjoyed preferential import fees, which were lower than those applied to larger orders. However, the new regulations now standardise the fees across the board.
The 45% import duty, combined with VAT, significantly increases the final cost of these low-value orders.

Consumers must now factor in these charges when making purchasing decisions.

Explaining the intended purpose of this change, the South African Revenue Service (SARS) Commissioner, Edward Kieswetter, emphasised the rationale behind the new fees: “The decision to adjust import fees is a strategic move to promote fair competition and stimulate local production, ultimately contributing to the growth of our economy.”

Speaking to the SABC, South African Chamber of Commerce president Mthokozisi Xulu highlighted that low-cost retail delivery operators have taken advantage of a loophole that is no longer sustainable for the country’s economy.

He emphasised that local retailers must focus on improving their cost of production, service quality, and product offerings to remain competitive.

The decline in South Africa’s clothing manufacturing industry has necessitated this shift in approach.
Online retailers operating in South Africa face a critical challenge. The previous fee structure allowed them to offer competitive prices for small orders, attracting budget-conscious shoppers.

However, critics argue that protectionist measures could hinder international trade and limit consumer choice. Balancing economic growth with fair competition remains a delicate task.

South Africa’s import fee adjustments have far-reaching consequences. Consumers face higher costs, while retailers must innovate to remain competitive. As the nation balances economic growth and protectionism, stakeholders across the board must adapt to this new reality.