Get ready for a major overhaul of SA’s Diesel Refund Scheme. In case you were unaware, qualifying users are able to claim back the general fuel and Road Accident Fund (RAF) levies. Aimed at agriculture, mining, fishing and transport sectors, the scheme has been in place for 25 years, since 2001.
However, the South African Revenue Service (SARS) is preparing a comprehensive overhaul, reports BusinessTech. You see, while regular motorists rejoice at saving a few hundred rand per month when the fuel price drops, large businesses count diesel-price fluctuations in tens of thousands, if not hundreds of thousands …
SA DIESEL REFUND SCHEME
Which is why, diesel use for primary production activities is exempt from general fuel and RAF levies. However, experts say the Diesel Refund Scheme has become increasingly problematic and complicated over the years. For example, refunds were linked to VAT, which created many bookkeeping and administrative headaches.
Now, the biggest ever update to the system will reduce errors, tighten compliance and close the loopholes many were exploiting, says SARS. Also, because the Diesel Refund Scheme lacked proper checks, this allowed ineligible applicants to register and submit claims as a business with little verification.
SEPARATE FROM VAT
Therefore, a key change is that the Diesel Refund Scheme is processed on a standalone platform, separate from VAT. As such, both diesel sellers and diesel users will be required to register on the new SARS digital platform. The revenue service says this will improve traceability and verify claims and identify any irregular activity.
Likewise, Diesel Refund Scheme claimants will also be able to track the status of their refund claims in real time. And most importantly, simplified diesel logbooks will be introduced, addressing one of the biggest compliance hurdles under the old system.
WHO BENEFITS FROM DIESEL REFUND SCHEME?
The Diesel Refund Scheme applies to a wide range of ‘qualifying primary activities.’ So, if you run a business in the following sectors, you ought to be saving on your diesel bill:
- Farming
- Mining
- Forestry
- Offshore marine operations
- Commercial fishing
- Offshore mining
- Harbour vessels
- Research vessels
- Rail freight operators
- Electricity generation plants (minimum 200 megawatts)
What do you think? Do you run a business in the above sectors? And were you aware of the Diesel Refund Scheme? Let us know in the comments section below …
