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: 19 Aug 2016 | Removal date: open ended
Still in force

Tax or social insurance relief

On 19 August 2016, the Department of Trade and Industry (DTI) of South Africa issued Notice 504 announcing the approval of an application made by Nyanza Light Metals (Pty) Ltd for the 12I Tax Allowance Programme. As a result, the investment allowance granted to the local coating and chemical producer which is deductible from taxable income is ZAR 900 million (USD 66.6 million), and the training allowance is circa ZAR 10.1 million (circa USD 748,000).

The DTI has stated that the manufacturing qualifying assets accounted for the company's total investments estimated at ZAR 5,450 million (USD 403.4 million), and 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 Titanium Dioxide.

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

343 Tanning or dyeing extracts; tannins; colouring matter n.e.c.
3206 Other colouring matter; preparations as specified in Note 3 to this Chapter, other than those of heading 32.03, 32.04 or 32.05; inorganic products of a kind used as luminophores, whether or not chemically defined.
320611 Containing 80 % or more by weight of titanium dioxide calculated on the dry matter

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