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List of Five goods on which no vat is charged in South Africa

What is VAT?

List of Five goods on which no vat is charged in South Africa VAT is an abbreviation for Value-Added Tax. VAT, according to SARS, is an indirect tax on economic consumption of goods and services. The registration of businesses that carry on an enterprise (as defined in section 1(1) of the VAT Act) generates revenue for the government. In doing so, the company will charge VAT on its own goods and services, as well as on imported goods and services (subject to certain conditions). The firm will also be able to deduct any VAT charged to it, or under restricted circumstances from a non-registered business, in relation to a supply made to it. VAT is thus non-cumulative, which means that a credit/deduction is allowed for VAT paid earlier in the production and distribution chain. If the VAT levied to it exceeds the VAT charged by it, the firm must pay the difference or obtain a VAT refund.

 

List of goods and services that are zero-rated

Zero-rated and exempt supplies:

• Exports
• 19 basic food items
• Illuminating paraffin
• Goods which are subject to the fuel levy (petrol and diesel)
• International transport services
• Farming inputs
• grants by government.

Goods and services exempted from VAT are:

• Non-fee related financial services
• Educational services provided by an approved educational institution
• Residential rental accommodation,
• Public road and rail transport.

List of 19 basic food items that are zero-rated for VAT.

According to the South African government, there is no VAT that should be charged on the following list of food items:

• Brown bread.
• Maize meal.
• Samp.
• Mealie rice.
• Rice.
• Vegetables.
• Fruit.
• Vegetable oil.
• Milk.
• Cultured milk.
• Brown wheaten meal.
• Eggs.
• Dried mealies.
• Dried beans.
• Lentils.
• Pilchards/sardinella in tins.
• Milk powder.
• Edible legumes and pulses of leguminous plants.
• Dairy powder blend.

VIDEO:How Vat Work in South Africa

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