South Africa: More Ports Charging Import Tax on Foreign Yachts
Published: 2013-08-23 00:00:00
Countries: South Africa
Customs abuse against visiting yachts - Notice 10 September 2013
Local charter skipper Izak Labuschagne (quoted below in the Witness article) is now working towards legal action against SARS. He has this message for any affected skippers who want to get involved:
"If you have been a victim of this campaign then please send me an e-mail on firstname.lastname@example.org and please send copies of the documents they presented and who the people involved are. I cannot represent you but I will co-ordinate the necessary procedure to put a stop to this and perhaps even get you a refund. Cell 0731 5678 25 and 084 7722 773."
Update 23rd August 2013
By David Frost of SV Taipan
The events of last year reported at Richards Bay and Durban have been repeated again on the Western Cape. See last years post on this subject - http://bwsailing.com/cc/2012/10/24/foreign-yachts-charged-new-tax-in-south-africa/
We are aware of the impounding or detention of a number of yachts at port Owen and Suldana and have been told these actions have also been reported on the Eastern coast again.
Our yacht was impounded at Suldahna along with several others. We have only been cleared into the country for two and a half months. We spent 3 days in Cape Town sorting this debacle out and were told it was not supposed to have happened. This does not help much. The officer responsible for issuing all the notices was absent from work for the whole time we were in Cape Town.
We have been granted a 21 day extension of stay for the boat.
Posted 22nd October 2012
Noonsite has received a number of emails from concerned cruisers in Richards Bay, South Africa (see bottom of report). This excellent article by local press The Witness explains the situation well.
Foreign yachties irked by odd new tax
08 Oct 2012
YACHTIES extending their stays in South Africa are being threatened with having their vessels impounded unless they temporarily import them, or face having to pay fines.
Customs officials are springing laws on them that apply to commercial vessels, causing confusion at moorings in Richards Bay and Durban. Foreign yachtsmen are being expected to temporarily import their vessel if they remain in South Africa for six months and can be fined up to 15% of the value of their yachts if they break this law.
The KwaZulu-Natal yachting fraternity is also concerned that they have not been informed of this law being enforced. The South African Revenue Services, which manages customs and excise, itself maintains that the document the yachties claim is being used to force them to temporarily import their crafts, is only for commercial vehicles and “does not deal with yachts as such”.
Zululand Yacht Club (ZYC) commodore Kirsten Schreuder said the imposing of this regulation could add unnecessary bureaucracy to an industry in South Africa that heavily relies on foreign yachtsmen bringing their vessels to KwaZulu-Natal’s coastline for repairs.
A vague public document called SARS Temporary Import of Commercial Vehicles, which was made effective in 2001, is allegedly being shown by custom officials to the yachting fraternity as validation of the need for the boats to be temporarily imported and justification for handing out fines. “It has caused a huge knee-jerk reaction from everyone. In September, the SAPS Water Wing and Customs arrived at the club and started checking papers, telling our foreign yachties they were in breach of the law. We were all caught completely off-guard. We have never been aware of these regulations,” said Schreuder.
With boats being “placed under arrest” according to one yachtie, Customs decided to only slap each transgressing yachtie with a R2 000 fine.
SARS spokesperson Marika Muller said the import document Schreuder is referring to “does not deal with yachts as such” but added that leisure sailors were still subject to certain expenses.
“Yachts that originate from countries within the European Union and SADC are free from customs duty but subject to 14% VAT,” said Muller.
“Yachts with any other origins are subject to the payment of 10% customs duty plus 14% VAT.”
She said, however, there were costs payable to Customs although these amounts were refundable.
In further questions posed to Muller regarding the import document, she said “the legislation on which you are basing your question is not applicable to yachts”.
But Zululand yachtie Izak Labuschagne said the entire affair is peculiar. “Yachties go to great efforts to comply with sovereign laws as they are travelling and their boat is their home. This idea of a temporary import is madness … the reasons for it being shown to us by local customs authorities is so vague, the only tangible result it will have is to chase touring yachts away from our shores,” he said. “The manner in which Customs has pursued foreign yachtsmen in our ports has left a perception, rightly or wrongly, that our officials are corrupt and were merely seeking to make a quick buck by extorting money out of unsuspecting foreigners not prepared to fight them.”
According to the ZYC, the yachting industry brings in about R15 million to the South African economy every month and this is likely to increase with the east coast of Africa further north and Suez Canal increasingly becoming a no-go zone because of the threat of Somali pirates. “We are seen as a safe and reliable destination at which to undertake repairs. We are not adverse to new regulations, just we need to know what they are,” said Schreuder.
He said instead of making it confusing for foreign pleasure sailors to sail into South Africa, it should be made easier through the introduction of a cruising permit valid for two years, a practice used in Trindad and Tobago in the Caribbean. “Vessels are brought to SA for refurbishment and repair, which can take up to two years. The owners are often retired and wealthy and either travel our country or fly home, returning once their yacht is repaired. We need to accommodate them and make our destination and boatyards favourable,” said Schreuder.
Durban Marina manager Malcolm Manion said there was a desperate need for further clarity on the regulations. “What we are finding frustrating is there is not much clarity being given on just how the regulations are to be enforced and what is expected of visiting vessels,” said Manion.
Cruisers in Richards Bay have reported the following to noonsite.com:
I wish to point out an error in the report above. The reports speak of the document 'SARS Temporary Import of Commercial Vehicles' as a public one. This is not correct. This is an internal SARS procedure spelling
out how Customs officials are to process commercial vehicles. It is not publicly available on the internet and hence not discoverable by outsiders. At least our extensive search yielded no results. It was emailed to us by the Customs chief, after many requests for proof of his basis for detention, to provide the justification for the (now clearly illegal) "fine".
Early September 2012 some 25 yachts were detained by Richards Bay Customs under the excuse that they had overstayed their allowable 6 months. Yachts were variously fined ZAR2,000 (about $250) and some are required to pay a bond (around 5000 - 6000 Rand) which apparently is refundable. However the customs case seems spurious as no one from Customs or SARS (the South African Revenue Service, which contains Customs) has been able to state which law or regulation had been violated. As a result some yachts have already left, while others are paying the stated fine and where applicable the bond (not all boats are treated the same way).
Several boats have been here many years and have never been pulled up by Customs before. No yacht club is aware of the 6 months regulation and even customs officers tell you that the time permitted is 1 year. Even now new arrivals are not being told they can only stay 6 months and then (before the time is up) must apply for an extension. The South African Marine Safety Association has stated that the 6 months are a nonsense and have even encouraged one cruiser to take the case to the Public Prosecutor.
However, many foreign yachties are understandably reluctant to take on a powerful institution such as Customs and are quietly paying up. Southern Africa is a wonderful place to visit for a year and it is hoped that the baffling issues in Richards Bay are sorted out quickly.
We recently returned to our yacht moored in Richards Bay, South Africa to find the yachties in an uproar over actions being taken by local customs officials. A vague public document called SARS Temporary Import of Commercial Vehicles, which was made effective in 2001, is allegedly being shown by custom officials to the yachting fraternity as validation of the need for the boats to be temporarily imported and justification for handing out fines.
We had been expecting that there would not be any issue for one year as reported on Noonsite's South Africa country pages. When we cleared into South Africa we told the officials our plan of staying in Richard's Bay for about five months and being in South Africa for about seven and a half months. They did not indicate that this would be any problem and did not give us any written information indicating that there would be an issue.
Comment received 23 October, 2012
I was interested to see the article regarding South African Officials targeting foreign yachts, I have recently had a similar experience.
I am a UK citizen resident in South Africa and a keen sailor. Some years ago I re-registered my South African built boat in the UK. I did this for consular protection while sailing off Africa. It also helps to cut through some of the extensive red tape that has been created in recent years.
I did undertake extensive research of the legal implications before re-registering. As far as I could see there was nothing precluding UK registration, the SA Maritime Safety Authority (SAMSA) actually makes provision for foreign registered boats in their regulations.
This was not a problem for a number of years as I cleared in and out of ports easily. However, prior to clearing out earlier this year, I was warned that I had to re-register my boat in SA.
I then spent three months between the Port Authority, Customs and SAMSA requesting sight of the relevant regulation. Needless to say, to date this hasn’t been provided, but I was threatened by officials resulting in a rapid re-registration of the boat in SA. Customs still threaten import duty and VAT based on the re-registration even though the boat has been based in South Africa since being built, has never been to the UK and VAT was paid originally in South Africa.
My experience is that officials do not understand the regulations that they are supposed to enforce. They regularly twist the meaning of straight forward clauses to include anything that they consider to be fair game and they see yachties as a soft target.
My advice is don’t argue, being right won’t help. If you can, get through South Africa quickly.