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: 01 Jun 2012 | Removal date: open ended
Still in force

Tax or social insurance relief

On 1 June 2012, the Department of Trade and Industry (DTI) of South Africa issued Notice 445 announcing the approval of an application made by Unilever South Africa (Pty) Ltd for the 12I Tax Allowance Programme. As a result, the investment allowance granted to the multinational company which is deductible from taxable income is ZAR 330 million (USD 38 million), and the training allowance is ZAR 12.6 million (circa USD 1.5 million). The Ministry estimates the foregone revenue to be ZAR 95,938,000 (USD 14 million).

The DTI has stated that from the company's total investments estimated at ZAR 665 million (USD 77.4 million), the manufacturing qualifying assets accounted for ZAR 600 million (circa USD 69.9 million). 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 ice cream.

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

222 Other dairy products
2105 Ice cream and other edible ice, whether or not containing cocoa.
210500 Ice cream and other edible ice, whether or not containing cocoa.

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