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 2014, the Department of Trade and Industry (DTI) of South Africa issued Notice 382 announcing the approval of an application made by Air Liquide (Pty) Ltd for the 12I Tax Allowance Programme. As a result, the investment allowance granted to the gas manufacturer and provider which is deductible from taxable income is ZAR 550 million (USD 46 million), and the training allowance is circa ZAR 576,000 (USD 48,000).

The DTI has stated that from the company's total investments estimated at ZAR 2,376 million (USD 199 million), the manufacturing qualifying assets accounted for ZAR 2,201 million (USD 184.6 million). Due to the specific characteristics of the project, the DTI classified this investment as a Greenfield project.

The purpose of the investment is to manufacture gaseous Oxygen and Nitrogen as well as Liquid Oxygen and Argon.

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

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