During the 2023 budget speech the Minister of Finance announced that in light of the electricity crisis a similar diesel refund to the current system in place (for farming, forestry, fishing and mining), would be introduced for manufacturers of foodstuffs. Regardless of the date of implementation of the legislation this refund would take effect from 1 April 2023 and would be for a period of 2 years until 31 March 2025 – however (as with the COVID ) often these measures are extended beyond their original intended period.
The refund is in respect of 80% of the RAF levy for diesel purchased for use and used in manufacturing of foodstuffs.
Those who intend to participate will have to register with SARS. It is important to note that this new refund will be separate from the current diesel refund scheme which is administered through the VAT return. Accordingly claims will be done separately through the DA 66 process.
The legislation and system is not yet formally in place but draft legislation giving full details of the requirements and those who qualify has been published.
Clients involved in the food manufacturing sector (including the production of fish products) should already be preparing to take advantage of this refund.
Should you require any advice on whether system applies to your business and how to prepare for claiming please feel free to contact our Peter Edwards.
082 495 1100