SA digital tax to hit online gamers in the pocket
I'm gonna say this again, technically we should have been paying VAT all along but consumers haven't been doing so, thus they are moving the responsibility from consumers to retailers. It was gonna happen eventually with online sales increasing. I can find the section in the VAT act later.
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Okay
Q U E S T I O N T I M E K I D S !
Do we pay 14% of Tax in USD or ZAR?
Tip: This is VERY important.
14% of the value in USD is equal to 14% of the value in ZAROriginally Posted by Glordit
Good luck with that...
Kinda. The sections you're thinking of (importing goods & importing services) aren't even close to adequate to plausibly say we should be paying VAT on it. Or rather they were unworkable to such an extent that there was no real risk in it ever causing problems. When they we're drafted, the notion of digital goods simply didn't exist.
e.g. Suppose I buy a steam game & set my steam server to Botswana. Do I now pay BLNS rates or not? Did I import it from Botswana or from the US? And regardless of what rate is used...whats the custom value of something that didn't cross the border and the price fluctuates hourly depending on whether a flash sale is on or not.
The conversion rate would be the daily rate as published on Sars's website.
The value would be the invoice value that you paid.
Since you bought the game from an American company it's an American import, but Sars can also claim tax evasion if your sole reason was to obtain a tax benefit (like you sate trying to suggest)
However this is just based on a conversation with my honors tax lecturer last year on online Microsoft and steam purchases. But once again this was previously the obligation of the purchaser of said imported digital rights and now I think Sars believes it is feasible to switch the obligation.
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may they burn in the deepest darkest pits of oblivion, may their corpses be sodomised and devoured by Molag Bal in Cold Harbour
Play games, not platforms
So if I load 20 USD into my Steam wallet and want to buy a game at 19.99 USD, do I pay 19.99 incl. TAX or 19.99 X 1.14 = 22.78 USD?
This was inevitable really...when money leaves a country, the government would want a cut of that. Technically, it is an import.
That's what she said.
The Dork Knight.
If it's done similarly to how it's done in Europe then you will see the price as is on Steam (i.e. you'll see the amount including the tax) and Valve will, through HM Revenue & Customs in the UK, deal with tax payment to ZA. Unless Valve comes up with another solution to pay the tax to ZA.
Who knows. But the amount of VAT will be included in the price, it won't be bolted on separately.
Valve:
Are taxes collected for Steam purchases?
If you made an online order for a Valve product and you are an international customer there may be taxes or VAT charges included in your purchase.
To the extent VAT applies to a transaction, Valve absorbs that cost and pays VAT itself.
Valve Corporation reports VAT declarations on a quarterly basis to HM Revenue & Customs in the UK, who then distributes to the various EU member countries.
Valve Corporation's eleven character "Special Scheme" identification number is:
EU 826 000 671
HM Revenue & Customs can be contacted by telephone in the UK at 0845 010 9000 (+44 208 929 0152 for international callers), or via their website at http://www.hmrc.gov.uk/
The law specifically refers to customs value, which is not necessarily invoice amount. In fact it seems to be based mostly of the lunar calendar and/or lotto numbers.
Is it? The VAT act gives no specific guidance on source rules. So perhaps we should consider the deemed source rules from income tax as a guide line. There different rules apply depending on the type of goods or services. Steam is providing a service essentially (serving content) and the main component of the serving of content is being done from Botswana...so is the fact that the legal entity (valve) is registered in the US really relevant given that the actual supply of services is from Botswana? Also, if I buy the steam game in 2012 and then proceed to download it from a Botswana server during 2013 do I fall under 2012 or 2013 tax rules?
All of the above is of course complete BS...my point is simply that this stuff is 100% fuzzy. So fuzzy that while technically you should perhaps be paying VAT, its so far removed from feasible that its not worth thinking about.
In situations like that the gov prefers to not do anything and amend the law rather than fight & lose. If you're facing SARS in court then you're proper fk'd - they only do cases they know are bulletproof. Most of the time they either don't make a fuss (e.g. fuzzy VAT on digital till now) or fold early.
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Actually come to think of it...doesn't Amazon charge VAT on kindles?
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