Share with your friends

South Africa: Regulation would expand scope of taxable electronic services

South Africa: Scope of taxable electronic services

Under measures in the budget 2018 and a draft regulation, the scope of taxable electronic services supplied by foreign suppliers would be broadened.


Related content

The draft regulation issued by the South African Revenue Service is relatively brief. Only two exclusions from value added tax (VAT) would be allowed—one for educational services provided by a person that is regulated by an educational authority in an export country, and the other for the supply of telecommunications services (as defined in the regulation). At this time, there is no indication that the regulation would not apply to business-to-business (B2B) supplies. 

There may also be a further expansion of VAT with respect to services supplied by intermediaries and so-called “platforms.”

The intended effective date is 1 October 2018. 

SARS requested comments on the draft regulation be provided by 22 March 2018. It is expected that comments would address items such as the administrative burden, particularly in relation to B2B supplies, and the implications for inter-group supplies.


Read a March 2018 report [PDF 219 KB] prepared by the KPMG member firm in South Africa

Read a May 2018 report [PDF 303 KB] prepared by KPMG’s Indirect Tax practice

The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us


Want to do business with KPMG?


Request for proposal