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South Africa’s 2025 Draft Taxation Laws Amendment Bill proposes abolishing VAT relief on low-value imports under ZAR 500, aligning legislation with SARS’s interim measures since 1 September 2024 and confirming VAT’s application to all imported goods.
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Current law still exempts imports under ZAR 500 where no customs duty applies, but SARS already applies VAT in practice. Formal amendments will also remove relief on printed materials, affecting publishers, education supply chains, and postal consignments.
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National Treasury’s policy seeks competitive neutrality by eliminating offshore sellers’ VAT advantage, addressing revenue leakages from booming eCommerce and small parcel imports. OECD data highlights rapid parcel growth, underscoring the urgency of legislative enforcement measures.
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Proposed changes introduce simplified customs entry for express shipments, with parcel thresholds set by the Minister of Finance. Businesses must reassess pricing, update customer communications, prepare tax teams, and coordinate with carriers to manage compliance and costs.
Source: Baker McKenzie
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