{"id":227005,"date":"2018-02-22T07:49:06","date_gmt":"2018-02-22T05:49:06","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=227005"},"modified":"2018-02-22T08:18:47","modified_gmt":"2018-02-22T06:18:47","slug":"smartphones-are-officially-luxury-items-in-sa-and-theyre-getting-taxed-as-such","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/mobile\/227005\/smartphones-are-officially-luxury-items-in-sa-and-theyre-getting-taxed-as-such\/","title":{"rendered":"Smartphones are officially &#8216;luxury items&#8217; in SA &#8211; and they&#8217;re getting taxed as such"},"content":{"rendered":"<p>While higher-income South Africans will not face a wealth tax after this year&#8217;s budget, they are expected to contribute to the budget in other ways.<\/p>\n<p>This includes an increase in estate duty for properties worth R30 million or more (from 20% to 25%) and higher excise duties on luxury goods (from 7% to 9%).<\/p>\n<p>&#8220;A less complex means of applying higher taxes to luxury goods is to increase ad valorem excise duties,&#8221; explains Treasury&#8217;s <strong><a href=\"http:\/\/www.treasury.gov.za\/documents\/national%20budget\/2018\/review\/FullBR.pdf\" target=\"_blank\" rel=\"noopener\">official budget review<\/a><\/strong>.<\/p>\n<p>&#8220;Government proposes to increase these rates, which are already applied to some goods that are consumed mainly by wealthier households (such as cosmetics, electronics and golf balls).<\/p>\n<p>&#8220;The associated revenue-raising potential is not significant, but it is aligned with the progressive structure of the tax system,&#8221; it said.<\/p>\n<p>Ad valorem products include &#8211; among others items &#8211; motor vehicles, electronic equipment, cosmetics, perfumeries and other products generally regarded as \u201cluxury items\u201d &#8211; and are subjected to the payment of Ad Valorem Excise Duty if used within the Southern African Customs Union (SACU).<\/p>\n<p>However this list will now also explicitly include smartphones, Treasury said<\/p>\n<p>&#8220;Effective 1 April 2018, the maximum ad valorem excise duty for motor vehicles will be increased from 25% to 30%, and the classification of cellular telephones will be updated to include &#8216;smartphones&#8217; to ensure they attract ad valorem excise duties.&#8221;<\/p>\n<p>&#8220;In addition, the ad valorem excise duty rates (now at 5% and 7%), will be increased to 7% and 9%, ensuring that households spending more on luxury goods contribute proportionately more to revenue,&#8221; it said.<\/p>\n<p>Treasury said that government also plans to\u00a0consult on a proposal to replace the flat rate for cellphones with a progressive rate structure based on the value of the phone.<\/p>\n<hr \/>\n<p><strong>Read:\u00a0<a href=\"https:\/\/businesstech.co.za\/news\/finance\/226995\/rand-strengthens-as-budget-speech-avoids-nasty-surprises\/\" target=\"_blank\" rel=\"noopener\">Rand strengthens as budget speech avoids nasty surprises<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>While higher-income South Africans will not face a wealth tax after this year&#8217;s budget, they are expected to contribute to the budget in other ways.<\/p>\n","protected":false},"author":10,"featured_media":201188,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[34],"tags":[26],"class_list":["post-227005","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mobile","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/227005","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=227005"}],"version-history":[{"count":11,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/227005\/revisions"}],"predecessor-version":[{"id":227129,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/227005\/revisions\/227129"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/201188"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=227005"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=227005"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=227005"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}