IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

firm-specific

JUMBO

No

TARIFF PEAK

No
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Inception date: 10 Mar 2017 | Removal date: open ended
Still in force

Tax or social insurance relief

On 10 March 2017, the Department of Trade and Industry (DTI) of South Africa issued Notice 205 announcing the approval of an application made by Main Street 1310 (Pty) Ltd for the 12I Tax Allowance Programme. As a result, the investment allowance granted to the local consumer product business which is deductible from taxable income is ZAR 180 million (USD 13.6 million), and the training allowance is ZAR 3.5 million (circa USD 265,000).

The DTI has stated that the manufacturing qualifying assets accounted for the company's total investments estimated at ZAR 514.6 million (USD 38.9 million), and due to the specific characteristics of the project, the DTI classified this investment as a Brownfield project.

The purpose of the investment is to manufacture toilet and facial paper, and industrial towels and wipes.

 
Section 12I Tax Allowance Incentive
The 12I Tax Incentive seeks to promote Greenfield and Brownfield investments with the objective to boost the productivity of the South African manufacturing sector and increase the productivity of the human capital.
 
The minimum investment required in qualifying assets is ZAR 50 million for a greenfield project (projects that use only new and unused manufacturing assets) and an additional investment of ZAR 30 million for a brownfield project (expansions or upgrades of existing industrial complexes). 
 
The total investment allowance range between 35% and 55% (or ZAR 350 million and ZAR 900 million) depending on the type of the investment, the status classification, and the localization.

AFFECTED COUNTRIES

MAP
TABLE
EXPORT

AFFECTED SECTORS AND PRODUCTS

321 Pulp, paper & paperboard
4818 Toilet paper and similar paper, cellulose wadding or webs of cellulose fibres, of a kind used for household or sanitary purposes, in rolls of a width not exceeding 36 cm, or cut to size or shape; handkerchiefs, cleansing tissues, towels, tablecloths, serv
481820 Handkerchiefs, cleansing or facial tissues and towels

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