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: 21 Sep 2012 | Removal date: open ended
Still in force

Tax or social insurance relief

On 21 September 2012, the Department of Trade and Industry (DTI) of South Africa issued Notice 763 announcing the approval of an application made by PhytoAmandla (Pty) Ltd for the 12I Tax Allowance Programme. As a result, the investment allowance granted to the local company which is deductible from taxable income is ZAR 900 million (USD 109.2 million), and the training allowance is ZAR 9.5 million (circa USD 1.2 million).

The DTI has stated that from the company's total investments estimated at ZAR 2,871.3 million (USD 348.4 million), the manufacturing qualifying assets accounted for circa ZAR 2,256.7 million (USD 273.8 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 biofuel, glycerine and crop meal.

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

219 Oil-cake; flours & meals of oil seeds; vegetable waxes; etc.
2304 Oilcake and other solid residues, whether or not ground or in the form of pellets, resulting from the extraction of soyabean oil.
230400 Oilcake and other solid residues, whether or not ground or in the form of pellets, resulting from the extraction of soyabean oil.
345 Miscellaneous basic chemical products
2905 Acyclic alcohols and their halogenated, sulphonated, nitrated or nitrosated derivatives.
290545 Glycerol
354 Chemical products n.e.c.
3826 Biodiesel and mixtures thereof, not containing or containing less than 70 % by weight of petroleum oils or oils obtained from bituminous minerals.
382600 Biodiesel and mixtures thereof, not containing or containing less than 70 % by weight of petroleum oils or oils obtained from bituminous minerals.

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