FSA, along with its members were invited to attend a “Forestry Specific” Workshop at the SARS offices in Pretoria on 22 August 2018 to discuss issues surrounding the diesel tax refund. It was a productive meeting in that that Industry was able to engage directly with SARS officials on (a) concerns that the Industry had with their new proposals and (b), clarifying the various issues with them relating to the operational charaterstics of the Industry.
Please find attatched FSA’s Submission to SARS flowing from the items discussed at the above mentioned meeting – the third such Submission made. I have also attached our previous two Submissions as Annexures A & B. Please note that this submission is based on an Industry perspective. The FSA members who attended the meeting were all invited to make their own individual company submissions.
Of importance to note is that our FSA submission motivates and gives recommendations on the following main points raised:
- Definitions as to various aspects of what constitutes “primary production” in the Forestry Industry context – of particular importance being those related to:
- what constitutes primary production;
- where does primary production end in terms of the value chain; and
- which “qualifying” activities should be included for the purposes of a diesel tax refund.
- An overview of the:
- regulatory obligations imposed by Government on the Sector;
- outsourcing, contracting and partnership arrangements presently operational in the Sector; and
- other arrangments specific to the Sector.
- How small-scale timber growers could be assisted to benefit from the diesel tax refund system.
Given the recommendations made, it is hoped that SARS will not only put in place a system to benefit small-scale-timber growers but will also allow the following activities to be deemed to be qualifying activities (which, under the current proposals, they are not):
- Any “off-site” transport, most importantly, long-haul transport of timber to mills and empty return trips from mills
- Transport of wattle bark
- Transport of biomass
- Activities carried out by labour carrier vehicles
- Activities carried out by “Forest Protection” vehicles
Should SARS adopt the recommendations made by FSA, this could potentially save the Industry many millions of Rands per year in its diesel fuel bill.
- FSA Submission to SARS re Diesel Tax Refund Proposal September 2018
- Annexure A – FSA Submission to SARS re Diesel Tax Refund – Feb 2016
- Annexure B – FSA Submission to SARS re Diesel Tax Refund – May 2017
Source: Forestry South Africa