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: 12 Apr 2012 | Removal date: open ended
Still in force

Tax or social insurance relief

On 12 April 2012, the Department of Trade and Industry (DTI) of South Africa issued Notice 310 announcing the approval of an application made by Sephaku Fluoride Ltd for the 12I Tax Allowance Programme. As a result, the investment allowance granted to the local chemical company which is deductible from taxable income is circa ZAR 480.7 million (USD 60.9 million), and the training allowance is ZAR 3 million (USD 380,000). The Ministry estimates the foregone revenue to be ZAR 135,436,537 (USD 20 million).

The DTI has stated that from the company's total investments estimated at ZAR 1,395 million (USD 176.8 million), the manufacturing qualifying assets accounted for ZAR 1,373 million (USD 174 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 Sulphuric Acid, Hydrogen Fluoride, Aluminium Fluoride and Alphydrite.

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

342 Basic inorganic chemicals n.e.c.
2826 Fluorides; fluorosilicates, fluoroaluminates and other complex fluorine salts.
282612 Of aluminium
354 Chemical products n.e.c.
3815 Reaction initiators, reaction accelerators and catalytic preparations, not elsewhere specified or included.
381519 Other

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