The announcement by SARS (July 19) that the proposed implementation of increased tariffs on imported clothing from Shein and Temu has been put on the back burner has been welcomed by consumers.
"Level the playing fields" (i.e. make it fair for everyone) is the emotional blackmail perpetrated ad nauseam by big clothing retailers on a subservient government to increase taxes on affordable clothing.
45% + VAT for everyone!
Meaning:
Retailers 45 + VAT = 45%. Retailers reclaim the 15% VAT.
Consumer 45 + VAT = 60%. Consumers unable to reclaim 15% VAT.
This is anything but level! In fact, it is discriminatory, misleading and blatantly unfair!
Government hugely accommodates and supports the clothing industry:
- R2.5 billion funding aid in an elaborate "Master Plan".
- Millions of rands in interest-free loans repayable over five years!
- Concessions, rebates, incentives, subsidies etc.
The Minister of Trade and Industry announced that the grandiose "Master Plan" had resulted in a very healthy clothing sector.
The same support and succour for cash-strapped taxpayers?
No concessions, no interest-free loans, no “Master Plan” for parlous, indigent citizens - just increases in food, transport, electricity etc, for the financially emaciated Joe Citizen!
Level playing fields also for consumers? Absolutely not! The public is an irrelevant, expendable commodity — only big, powerful corporates matter! Are there not two sides to this coin?
Recently, two of the largest clothing groups jubilantly announced record sales and profit!
R39 billion (R6 billion profit) and R37 billion (R5 billion profit), dividends up to 15% because of exorbitant mark-ups!
So does budget clothing from Shein and Temu affect them? Obviously not! Crying wolf, officialdom kowtows meekly.
Government practices protectionism for privileged retailers, but cash-strapped, financially-challenged consumers with huge poverty issues are denied access to a very basic necessity: affordable clothing. Just throw them under the bus, again!
We are now part of the global village! When are local traders going to realise that eCommerce is the future, that they need to rise to the challenge, become innovative, re-invent and seize the huge opportunities offered — only when government stops being at their beck and call, ever ready to react preferentially every time they whimper!
Nelson Mandela said: "A nation should not be judged by how it treats its highest citizens, but how it treats its lowest citizens!"
"Level the playing field" in this instance, is a complete misnomer designed to hoodwink officialdom, advantage already-pampered elite corporates and once again disregard the dire financial challenges of ordinary poor South African citizens already tormented by the high cost of living and rampant unemployment.
The growth in the eCommerce, low-value imports has spawned many thousands of jobs for mainly the young and provided income for thousands of independent, owner couriers in the logistics field. This will be seriously jeopardised by the proposed tariff increase. Can we afford just one more job loss? In addition, billions of rands in customs duties are collected.
The arbitrary imposition of the new tariffs is also a slap in the face of China. It is directly targeted at eCommerce giants Temu and Shein.
There is no consideration for China, our largest trading partner, with whom we have very cordial trading relationships. Surely, just basic protocol and good manners would require discussion and mutual agreement?
When questioned as to whether China had been consulted in the tariff change, a vociferous industry lobbyist responded: "We didn't have to, it's just a minor detail!" Really?
Regular meetings between President Cyril Ramaphosa and President Xi Jinping results in public announcements and commitment to foster and grow congenial bi-lateral trading platforms in recognition of a very close partnership.
China has made huge investments in South Africa, even to the extent of donating R150 million worth of generators at the height of load-shedding!
There are strong government-to-government relations between South Africa and China to promote two-way trade.
The announcement to impose 45% duty plus 15% VAT requires input from all stakeholders with due consideration for jobs, independent couriers and traders — it cannot be a draconian, one-sided decision favouring big, elite corporates. An unemotional meeting of the minds is required with a fair and equitable solution found.
Surely, "A better life for ALL!" must always be envisioned in this land where "Ubuntu" should never be sacrificed on the altar of greed and profit!
* The letter writer’s name has been withheld to protect their identity.
** JOIN THE CONVERSATION: Send your submission to [email protected] including your full name, bio, contact details and physical address (not for publication).