Customs Duty is a tax levied by the government and is payable on imported goods. South Africa is part of the Southern African Customs Union (SACU). The member countries of the SACU are South Africa, Botswana, Lesotho, Namibia and Swaziland. These member countries are all liable for the same uniform rate of Customs Duty. The relevant rate of Customs Duty is dependent on the classification of the product.
There are basically three types of Customs Duty:
- Ad Valorem (On Value) Customs Duty. The most frequently used, particularly in respect of luxury goods. Ad Valorem Duty is payable on the value of the goods and it is applied on the value for customs duty purposes.
- Specific Customs Duty. Generally ‘Sin Products’ (i.e. liquor and tobacco) are subject to Specific Customs Duties based on either their weight or literage.
- Rated or Formal Duties are essentially used in respect of clothing and textile goods.