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: 28 Oct 2016 | Removal date: open ended
Still in force

Tax or social insurance relief

On 28 October 2016, the Department of Trade and Industry (DTI) of South Africa issued Notice 712 announcing the approval of an application made by Tongaat Hulett Limited for the 12I Tax Allowance Programme. As a result, the investment allowance granted to the local agricultural and agri-processing company which is deductible from taxable income is circa ZAR 288.8 million (USD 20.9 million), and the training allowance is circa ZAR 2.4 million (USD 173,000).

The DTI has stated that the manufacturing qualifying assets accounted for the company's total investments estimated at ZAR 525 million (USD 38 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 refined sugar.

 
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

235 Sugar & molasses
1701 Cane or beet sugar and chemically pure sucrose, in solid form.
170112 Beet sugar
170113 Cane sugar specified in Subheading Note 2 to this Chapter
170114 Other cane sugar
170199 Other

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