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: 08 May 2015 | Removal date: open ended
Still in force

Tax or social insurance relief

On 8 May 2015, the Department of Trade and Industry (DTI) of South Africa issued Notice 384 announcing the approval of an application made by Saldanha Steel (Pty) Ltd for the 12I Tax Allowance Programme. As a result, the investment allowance granted to the local foods and beverages manufacturer which is deductible from taxable income is ZAR 350 million (USD 29.4 million), and the training allowance is ZAR 7.2 million (circa USD 604,000).

The DTI has stated that the manufacturing qualifying assets accounted for the company's total investments estimated at ZAR 1,310.6 million (circa USD 110 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 hot-rolled coil.

 
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

412 Products of iron or steel
7208 Flatrolled products of iron or nonalloy steel, of a width of 600 mm or more, hotrolled, not clad, plated or coated.
720837 Of a thickness of 4.75 mm or more but not exceeding 10 mm
720838 Of a thickness of 3 mm or more but less than 4.75 mm
720839 Of a thickness of less than 3 mm
7219 Flatrolled products of stainless steel, of a width of 600 mm or more.
721921 Of a thickness exceeding 10 mm
721922 Of a thickness of 4.75 mm or more but not exceeding 10 mm
721932 Of a thickness of 3 mm or more but less than 4.75 mm
721933 Of a thickness exceeding 1 mm but less than 3 mm

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