More pain for South Africans who shop at Shein and Temu

CapeTalk's Lester Kiewit speaks to Garry Marshall, CEO of the SA Express Parcel Association.

Listen below:

SARS Commissioner Edward Kieswetter has issued a notice of intention to update all customs concessions, including reduced taxes and simplified clearance processes.

The notice specifically includes concessions, deviations, agreements or special allowances that have been granted in the past to traders concerning some requirements of the Customs and Excise Act.

Global online giants like Shein and Temu could be among the hardest hit. For years, they’ve benefitted from a simplified customs process – originally introduced in 2007 – that allowed companies to import shipments under R500 with a low, flat 20% duty rate. 

This method, created during the early boom of e-commerce, was meant to help logistics firms keep up with the flood of imported packages.

Local South African retailers say the system gave foreign sellers an unfair edge. 

Not only did it lower costs for the giants, but it also opened the door to manipulation – like splitting parcels to stay under the R500 threshold.

In response, SARS attempted a temporary fix in 2024 by stacking VAT on top of the duty.

This would mean that products from Chinese retailers Shein and Temu can no longer be cleared at customs using a simplified process with a 20% flat duty rate.

Now, more changes seem to be in the works.

SARS has opened a short window for feedback, with stakeholders having until 23 April 2025 to argue their case where any plea to keep a concession must come with solid reasoning or a proposed change in the law.

"The new regulations so far as a new system and tariff regime started in September [2024] already and was fully implemented on 1 February so we're already into the third month of this... there's no longer a concession and a concession was granted many years ago when it was a different world, when there was no technology and when everything was done manually... South Africa never had a de minimis rule which means a value that is placed on goods that are of little or no consequential Rand value... 

- Garry Marshall, CEO - SA Express Parcel Association

"I think the key issue is not only the duty but the issue of a simplified clearance... E-commerce demands that people want things faster and so the customs concession was set up to create a simplified clearance model at a low value for goods... the cost of processing them becomes higher than the cost of the goods."

- Garry Marshall, CEO - SA Express Parcel Association

"SARS' role is not only to protect the fiscus but also to facilitate trade."

- Garry Marshall, CEO - SA Express Parcel Association

"It's a complex thing because it involves technology, it involves changes in systems, not only on SARS' side but for couriers and also the shippers who need to come to the party in terms of how they declare the goods."

- Garry Marshall, CEO - SA Express Parcel Association

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