{"id":52545,"date":"2014-01-31T09:40:03","date_gmt":"2014-01-31T07:40:03","guid":{"rendered":"http:\/\/businesstech.co.za\/news\/?p=52545"},"modified":"2014-01-31T12:21:14","modified_gmt":"2014-01-31T10:21:14","slug":"sa-digital-tax-coming-in-april","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/trending\/52545\/sa-digital-tax-coming-in-april\/","title":{"rendered":"SA digital tax coming in April"},"content":{"rendered":"

Treasury<\/a> has published new electronic services regulations, detailing which digital products and services will be subject to 14% VAT come 1 April 2014.<\/p>\n

The regulations have been published by Finance Minister Pravin Gordhan<\/a> for comment, and follow the proposals he made in his 2013 budget speech to impose VAT on foreign businesses who \u201csell e-books, music and other digital goods and services\u201d.<\/p>\n

The regulations are called the Electronic Services Regulations and come into operation on a proposed date of 1 April 2014.<\/p>\n

“This announcement was made against the backdrop of efforts, both internationally and locally, to bring cross border e-commerce (specifically the digital economy) into the VAT regime,” Treasury said in a statement.<\/p>\n

“The current application of VAT on imports does not lend itself to the effective enforcement on imported services or e-commerce where no border posts (or parcel delivery agents, e.g. the Post Office) can perform the function as collecting agents, as is the case with physical goods.”<\/p>\n

“The net result is that the local consumers can buy imported digital products without paying VAT. This outcome not only places local suppliers of digital services at a competitive disadvantage (compared to suppliers from abroad) but also results in a loss of revenue for the fiscus.”<\/p>\n

\"Pravin<\/a>

Pravin Gordhan<\/p><\/div>\n

In terms of the regulations, the VAT will apply to any supplier of electronic services from an \u201cexport country\u201d to any resident in South Africa, or where payment is made from a local bank.<\/p>\n

What exactly will be taxed? The list below details all digital goods and services which will be impacted, according to the regulation document:<\/p>\n

Educational services<\/h3>\n