Levelling the Playing Field for SA Manufacturing & Retail

In response to the surge in global e-commerce and a flood of duty-free micro-parcels, the European Union has established a €3 (roughly R56) flat customs duty per item on low-value imports.

We may need equally bold action in South Africa, where local manufacturers and retailers continue to operate in a severely distorted commercial environment.

Products entering South Africa in small parcels are difficult to regulate, routinely bypassing the standard customs duties and import VAT applied to commercial shipping containers. The exponential growth of low-value, direct-to-consumer micro-parcels has simply outpaced traditional border enforcement.

This regulatory deficit extends beyond tax policy into non-tariff mechanisms. Recent policy shifts aimed at curbing unfair trade—such as introducing mandatory origin certification and pre-export verification to ensure product compliance before shipment—continue to suffer from administrative and logistical delays. When non-tariff mechanisms experience patchy implementation, local manufacturers remain exposed to substandard imports and market distortion.

This is not uniquely a South African operational friction; economic regulators worldwide are taking decisive policy action to protect domestic markets. While the South African Revenue Service (SARS) moved to align low-value parcel tariffs with standard commercial rates, practical enforcement remains hampered by administrative bottlenecks in processing high-volume micro-consignments. Postponing enforcement or leaving compliance gaps open simply punishes compliant domestic producers.

A healthy economy cannot function when local companies bear the full regulatory burden while overseas competitors exploit declaration loopholes. When foreign entities bypass local taxes and standards, domestic manufacturers lose market share, investment slows, and industrial employment shrinks.

The EU's approach offers a bolder, more practical model: it bypasses the traditional port-of-entry operational bottleneck by turning the duty into an automated per-item fee collected digitally before the parcel leaves its origin. South Africa may require the same decisive approach to restore a balanced playing field, safeguard industrial capacity, and protect local jobs.

John Lawson, CEO of the Cape Chamber of Commerce and Industry