1constitutional court of south africa

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The correct amount of duty

The main duties in question consist of customs duty on imported goods, excise duty on goods manufactured locally, and fuel levy on imported or locally produced goods. Liability for imported goods commences from the time when goods are deemed to be imported into the Republic.13 Duty is payable at the time of entry for home consumption of such goods.14 An importer of goods has to complete the requisite forms, produce a bill of entry as prescribed, and pay the customs duty within the time prescribed for making due entry.15 The customs duty payable is determined by application of, amongst others, sections 45, 47(1) and 58(1) of the Act as circumstances may require, as well as the provisions of Schedules 1 and 2. The value for duty purposes is determined by the provisions of Chapter IX of the Act.16 A wide range of persons is liable for the payment of duties under the Act.17 With reference to customs duty this would include the master or pilot of the ship or aircraft concerned;18 the container or the depot operator;19 and importers,20 the wide definition21 of which would include import clearing agents, for instance.

It is important to note that the Act is premised on a system of self-accounting and self-assessment.22 There exists no viable method by which the Commissioner can keep track of all goods imported that might result in customs duty being payable under the Act, and whereby such duties may be collected automatically. The Commissioner therefore verifies compliance through routine examinations and inspections and through action precipitated by suspected evasion.23
The correct amount of customs and excise duty can only be determined if goods are classified under the correct tariff heading, and the value, quantity or volume of the goods has been determined correctly. The Commissioner may make a written determination in order to set the applicable tariff heading or value in relation to specific goods.24
Such determination will be subject to appeal to a high court, but any amount due in terms of the determination shall be deemed to be correct and shall remain payable so long as the determination is in force.25 An appeal may be brought within one year of such determination.26 The appeals procedure envisaged by the above sections is based on the widely accepted principle relating to the recovery of fiscal claims of “pay now, argue later”.27 The provisions of section 39(1)(b) that payment of duty is to be made on delivery of the bill of entry is qualified by the following proviso:

“Provided that the Commissioner may, on such conditions, including conditions relating to security, as may be determined by him, allow the deferment of payment of duties due in respect of such relevant bills of entry and for such periods as he may specify.”28

Interest, fines, penalties and forfeitures

The second category of “debt” in respect of which the provisions of section 114 are available to the Commissioner comprises interest, fines, penalties and forfeitures that have become payable. Interest is provided for in section 105 and does not run on penalties or fines. The Act provides for fines upon conviction for specific offences.29 Section 87(1) provides that goods dealt with contrary to the provisions of the Act or in respect of which an offence30 was committed, shall be liable to forfeiture. Section 93 provides for the remission of penalties in the discretion of the Commissioner. This would include forfeiture. The Commissioner may demand payment of the value of the goods liable to forfeiture in lieu of forfeiture.31 The reference in section 114(1)(a)(ii) to forfeiture would include payment in lieu of forfeiture. Section 105(c) provides as follows:

“[T]he Commissioner may on such conditions as he may consider necessary –

(i) remit any interest for which any person is liable by virtue of this section;

(ii) permit payment of any amount referred to in paragraph (a) by instalments of such amounts and at such times as he may determine”.

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