NEW REBATES FOR CERTAIN IMPORTED YARNS AND FABRICS ARE COMPLEX
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Several major companies in the garment and textile industry, including the SA garment and textile unions, have endorsed the creation of rebates for certain imports. Imported yarns and fabrics subject to rebates carry tariffs ranging from 0 to 30%.
Africans pay up to 40% tariffs on imported fabrics and clothing
The textile and garment industry in this country was highly competitive until it joined the World Trade Organization in 1994. Dabelman, a member of the recently established Customs Working Group of the South African Customs Experts Association, lost ground when tariff protection declined, flooded with low-priced imports, reduced local production, and then the factory It states that it was closed. ).
A garment manufacturer with a certificate of compliance from the National Council for Negotiations for the garment manufacturer gives the retailer, the signer of the Master Plan, garments made from fabrics imported under rebates. Can be supplied.
The same applies to textile mills that add value and supply to garment manufacturers who have the required compliance certificates and to retailers who are signatories to the Master Plan.
Under one of the Itac guidelines, rebated textiles will not be transferred to “or any other country other than SA” in Botswana, Eswatini, Lesotho, Namibia for further processing.
To be eligible for rebates, the manufacturer must pre-sell the product, an off-take contract with a local textile factory guarantees the same uptake as the previous year’s quantity and value, and manufactures with rebated yarn. Products and textiles are sold only in the country where the rebate was issued. According to MacKay, rebates are only beneficial to companies that can pre-sell their orders and buy the quantity of raw materials that matches their orders. “Bigger and more established South African producers will love the rebates as they keep out small competitors who have no history with retailers. [to secure orders] … I don’t think this latest trade policy can benefit anyone other than those who understand how to play the system, ”says Mackay. Keith Engel, CEO of Sait, is pleased to say that the government recognizes the need for competitiveness of businesses. But he wonders if the government is simply acting emotionally without understanding the industry. “The legal requirements for access should be used with caution [without prejudicing certain players] Otherwise, the proposal will not work as intended, “he adds.
Dobelman sees it as a step in the right direction to incentivize the industry to increase its importance in the economy and job markets.
He describes the import of staple woven fibers for the production of “knit or crochet apparel and garment accessories”. [Chapter 61 of the SA Customs Tariff Schedule] And “Articles on non-knit or crochet apparel and clothing accessories” [Chapter 62] Rebates are 22% cheaper and costs 22% lower. Rebate savings should lead to lower prices, higher sales and higher sales, paving the way for job creation and increased investment. “The textile and garment industry is investing in production processes, training employees and productivity to meet costs as imports increase and international garment retailers tend not to buy locally. Improvements need to be considered. ” At the same time, the government will have to ensure that it deals with illegal import and manufacturing activities, says Dobelman.
New rebates for certain imported yarns and fabrics are complex
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