Re: Digital products taxed in SA from April: Treasury

Does anyone have any ideas on how they're actually going to enforce this?

Or maybe this date from the regulations is telling:

"These regulations are called the Electronic Services Regulations and 
come into
operation on 1 April 2014."

(my 14 cents worth)

--Calvin

On 31/01/2014 13:43, dominic wrote:
>     [1]http://mybroadband.co.za/news/internet/95953-digital-products-taxed-
>     in-sa-from-april-treasury.html
>
>
>     [2]Treasury has published new electronic services regulations,
>     detailing which digital products and services will be subject to 14%
>     VAT come 1 April 2014.
>
>     The regulations have been published by Finance Minister [3]Pravin
>     Gordhan for comment, and follow the proposals he made in his 2013
>     budget speech to impose VAT on foreign businesses who "sell e-books,
>     music and other digital goods and services".
>
>     The regulations are called the Electronic Services Regulations and come
>     into operation on a proposed date of 1 April 2014.
>
>     In terms of the regulations, the VAT will apply to any supplier of
>     electronic services from an "export country" to any resident in South
>     Africa, or where payment is made from a local bank.
>
>     What exactly will be taxed? The list below details all digital goods
>     and services which will be impacted, according to the regulation
>     document:
>
> Educational services
>
>     .         distance teaching programmes;
>
>     .         educational webcasts;
>
>     .         internet-based courses;
>
>     .         internet-based education programmes; or
>
>     .         webinars,
>
> Games and games of chance
>
>     .         internet-based games, including any electronic game or
>     multiplayer role-playing game;
>
>     .         interactive games, such as games of chance, where the result
>     is influenced by the skill of the player;
>
>     .         electronic betting or wagering.
>
> Information system services
>
> Internet-based auction service
>
> Maintenance services
>
>     Which refers to technical support relating to
>
>     .         blogs;
>
>     .         databases;
>
>     .         information systems;
>
>     .         information system services; and
>
>     .         websites.
>
> Online content
>
>     .         e-books, which means any digitised content of any book or
>     electronic publication;
>
>     .         films, which means any broadcast, documentary home-made
>     video, live streaming performance, movie, music video, program,
>     television series, or video
>
>     .         images, which means any desktop theme, photographic image,
>     pictorial image, or screensaver,
>
>     .         music, which means any audio clip, broadcast jingle, live
>     streaming performance, ringtone, song, or sound effect,
>
>     .         software, including apps, system software, or plugins, and
>     any update to these programs.
>
> Subscription services
>
>     Any subscription service to:
>
>     .         blogs;
>
>     .         databases;
>
>     .         information system services;
>
>     .         journals;
>
>     .         magazines;
>
>     .         newspapers;
>
>     .         games;
>
>     .         social networking services;
>
>     .         webcasts;
>
>     .         websites;
>
>     .         web applications; or
>
>     .         web series.
>
>     The added taxes on digital goods is likely to push the price of goods
>     up, a tax expert has said.
>
>     Following the initial proposal for a digital tax, Gerard Soverall, PWC
>     `s head of indirect tax, said that, considering the revenue generated
>     by large online retailers, governments are losing out on large amounts
>     of VAT.
>
>     "It is a profit issue at the end of the day. VAT at 14% in South Africa
>     is a material number in your profits so online businesses will pass
>     that on [to consumers]. There is not much doubt in that," said
>     Soverall.
>
>     Soverall argued that, even if the 14% SA VAT is passed on to consumers,
>     digital goods are still likely to be more affordable than the physical
>     equivalent purchased in brick and mortar shops.
>
>     [The Electronic Services Regulations is available on the National
>     Treasury website: [4]www.treasury.gov.za and the South African Revenue
>     Service website: [5]www.sars.gov.za.
>     Written    comments    should    be    submitted    to    Mr.
>     Mpho    Legote,    email: [6][email protected] and SARS,
>     email [7]policycomments-hP/[email protected] by the close of business on 20
>     February 2014.
>     Issued by National Treasury Date:    30 January 2014]
>
> References
>
>     1. http://mybroadband.co.za/news/internet/95953-digital-products-taxed-in-sa-from-april-treasury.html
>     2. http://mybroadband.co.za/vb/showthread.php/477252-National-Treasury
>     3. http://mybroadband.co.za/vb/showthread.php/314269-Pravin-Gordhan
>     4. http://www.treasury.gov.za/
>     5. http://www.sars.gov.za/
>     6. mailto:[email protected]
>     7. mailto:policycomments-hP/[email protected]
>
>
>
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