Amendment: Notes Applying to Rebate & Refund of Fuel and Road Accident Fund Levies Payable on Diesel
11 December 2013
Posted by: Author: Andre Erasmus
Author: Andre Erasmus (ENS)
Schedule 1, Part 5, Sections A and B to the Customs and Excise Act (Act 91 of 1964) ("the Act”) provides, respectively, for a Fuel Levy of 197,5 cent per litre ("c/li”) and a Road Accident Fund ("RAF”) Levy of 96c/li on diesel imported or manufactured in South Africa.
Rebate item 670.04 of the Act provides for a refund of the Fuel and RAF Levies on diesel when used, inter alia, in own primary production activities in mining on land that includes operations for the recovery of minerals being mining for those minerals, including the recovery of salts.
The South African Revenue Service ("SARS”) has proposed an amendment to the above activity that qualifies for the diesel refunds to read: "Operations for the recovery of minerals being mining for those minerals including the recovery of salts but not including any post-recovery or post-mining processing of those minerals”.
Post-recovery or post-mining processing is not defined in Note 6 to rebate item 670.04 and we propose that all users of diesel refunds whose own primary production activities includes this activity should consider the implications of this exclusion on their future diesel refund applications and make representations to SARS in this regard since certain of the activities that currently qualify could be excluded from future diesel refund applications.
Comments to SARS’ proposed changes were due by 29 November 2013.
This follows an earlier proposed amendment made by SARS to Note 6 (f) (iv) to rebate item 670.04 that the following are not regarded as mining activities qualifying for the refunds:
(aa) Dredging, mining and any other activity to obtain materials for use in -
(bb) Mobile crushing operations such as the crushing of stone for road building and dam walls, to read:
(B) road making;
(D) construction and similar activities.
"The refund of levies in respect of the mining of sand, stone, rock, soil (other than topsoil), clay, gravel and limestone applies only if mined from a quarry” clarifying that only quarry activities will qualify for the diesel refunds."
This article first appeared on ensafrica.com.