Digital games tax proposed by SA government

This is already in SA's VAT act, its just that its one of those taxes that individuals don't know about and don't care about paying.
It will be interesting how SARS plans to monitor this. Especially people with american accounts.
However I'm sure if you get a voucher to top up your account you should be in the clear for VAT purposes as I think SA resellers add VAT.
 
American accounts can't be monitored, I think. If push comes to shove and these players pull out from SA, you can always use a DNS or VPN service to register as an American user. And remember, Oregon and Delaware does not have sales tax, nudge, nudge, wink, wink.
 
Mister 44 said:
American accounts can't be monitored, I think. If push comes to shove and these players pull out from SA, you can always use a DNS or VPN service to register as an American user. And remember, Oregon and Delaware does not have sales tax, nudge, nudge, wink, wink.
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Jip, there is always a way round these digital platforms so I have no idea how SARS plans to catch gamers out.
 
I thought the VAT act prevented foreign companies from charging South Africans VAT.
 
czc said:
I thought the VAT act prevented foreign companies from charging South Africans VAT.
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Foreign companies don't charge VAT, but once the goods/service "arrives" in South Africa, you should be declaring/paying VAT yourself, since it's considered an "import". The problem is that no one really does, especially when it comes to digital goods, and that is why SARS is now shifting the responsibility from the tax payer to the companies, who are easier to monitor.
 
What if the content you buy is hosted in the cloud? In a tax free state or country? You just stream to local. :P
 
I'm against piracy. Most people know that. If this tax forces Steam to not sell to South Africans anymore then it means that the government is promoting piracy.

The whole thing just makes me angry. :(
 
czc said:
I thought the VAT act prevented foreign companies from charging South Africans VAT.
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VAT is a tax on consumption so it depends on where the supply is consumed. That's why when you import goods, or in this case games, you are using the supply in SA and as such should be taxed.

What your forgetting is VAT is a tax on the company but the consumer, SARS is just trying to get companies to enforce the consumer to pay the applicable tax
 
Ike_009 said:
VAT is a tax on consumption so it depends on where the supply is consumed. That's why when you import goods, or in this case games, you are using the supply in SA and as such should be taxed.

What your forgetting is VAT is a tax on the company but the consumer, SARS is just trying to get companies to enforce the consumer to pay the applicable tax
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I would argue that nothing is being imported since nothing has been past customs. :p
 
Uberutang said:
What if the content you buy is hosted in the cloud? In a tax free state or country? You just stream to local. :P
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If it is used on a South African PC at any stage, it would be considered "imported". At least, that's how SARS seems to have defined it when I dealt with them. However, there could be a way around this for a lot of companies, but they'd need to employ some clever tax lawyers. There's an element of the VAT law that allows companies to zero-rate their products if the services involves "the granting, transfer, assignment, or of intellectual property rights, including copyrights provided the rights are used outside of the Republic". So, if Steam say that by downloading a game with them, they are granting a specific license that remains in the domain of US law, for example, the products should therefore be charged at 0% VAT. They'd just have to approach SARS and get a ruling on it for it to come into affect. But, it's a complicated business, and, well, it's SARS :P
 
czc said:
I would argue that nothing is being imported since nothing has been past customs. :p
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And the definition in the VAT administration act would disagree with you. I can get an official quote later this afternoon.
 
Coheed said:
Good luck on implementing that SARS. Argh, hoist the Jolly Roger me mateys!
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Well there's already FPB ratings implemented on Steam, so don't discredit the possibility of this happening just yet.

Seriously though, fuck these greedy assholes.
 
Strifehart said:
Well there's already FPB ratings implemented on Steam, so don't discredit the possibility of this happening just yet.

Seriously though, fuck these greedy assholes.
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I know that it may seem harsh and I'm against excessive tax just like anyone else, but might I point out that Tax revenues are how countries run, putting all the 'mal administration' aside if no tax comes in the country falls into a deficit and if you've studied maths and economics running in the red is never a good thing.

Tax pays for roads and upgrades I know we all moan about how terrible service delivery is, as bad as it is now imagine not having money to operate the 'basic' services we generally receive, if it be on a limited basis.

One could get angry and shout out about VAT and Tax but if you want to live in society and the economic model that currently exists as Quoted by Benjamin Franklin: "The only things certain in life are death and taxes."
 
Denouncer said:
If it is used on a South African PC at any stage, it would be considered "imported". At least, that's how SARS seems to have defined it when I dealt with them. However, there could be a way around this for a lot of companies, but they'd need to employ some clever tax lawyers. There's an element of the VAT law that allows companies to zero-rate their products if the services involves "the granting, transfer, assignment, or of intellectual property rights, including copyrights provided the rights are used outside of the Republic". So, if Steam say that by downloading a game with them, they are granting a specific license that remains in the domain of US law, for example, the products should therefore be charged at 0% VAT. They'd just have to approach SARS and get a ruling on it for it to come into affect. But, it's a complicated business, and, well, it's SARS :P
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I think I want you to do my taxes this year :D
 
Strifehart said:
Well there's already FPB ratings implemented on Steam, so don't discredit the possibility of this happening just yet.

Seriously though, fuck these greedy assholes.
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I was thinking the same thing. Steam seems to comply with the various countries' requirements which is why certain games are already "Not available in your region". Hopefully there will be a way around it.
Gamersgate already have some kind of a presence in SA so they might comply so perhaps there are some other digital distributors out there. (I've heard the name Greenman Gaming being thrown around a couple of times).
 
Meh, they just want more money in their pockets...as if paying R500+ for games isn't enough already. I doubt this will ever happen though, they have no way to enforce it.
 
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