South Africa’s tax authority has announced plans to impose a value-added tax (VAT) on low-cost parcels entering the country, aiming to protect the domestic clothing industry from intense competition posed by international e-commerce giants like Shein.
This decision aligns with similar measures being considered globally, such as the European Union’s discussions to eliminate its duty-free threshold as part of a broader customs reform.
In a statement released on Thursday, the South African Revenue Service (SARS) acknowledged the growing concern over the influx of imported goods, particularly clothing, through e-commerce platforms. SARS highlighted that many importers have been bypassing mandatory customs duties and VAT, creating what it described as “unfair competition” for local businesses.
The new tax is seen as a temporary but necessary step to level the playing field for South Africa’s clothing industry as it battles the increasing dominance of global online retailers.
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