SARS Rewrites Three Customs and Excise Rules: Transfer Pricing Adjustments, the Electricity Levy and Diesel Refunds

• Transfer pricing and customs value (effective 14 September 2026): new rules 40.03 and 41A.01 to 41A.04 (DAR279, Notice R.7900) require importers to notify SARS of related-party TP adjustments and submit a Customs Value Adjustment Calculation spreadsheet within 30 days. Extra duty and VAT must be paid within 14 days of SARS's written acceptance; refunds are claimed through vouchers of correction. Acceptance does not protect against later audit.

• Electricity levy repealed: the environmental levy on electricity generated in South Africa is repealed retrospectively from 1 January 2026 (Notice R.7903). Rebate item 681.08/000.00/07.00 (Notice R.7904) provides refunds, after the generator applies to cancel its manufacturing warehouse licence.

• Diesel refund registration: since 18 September 2026, diesel refund registration is separate from VAT. Existing users and all diesel sellers must register again, and purchases from unregistered sellers will not qualify. Claims continue through VAT201 until the standalone claims platform launches.

• Common theme: SARS is moving from ad hoc and embedded processes to dedicated, rules-based systems, with more data, more visibility and less room for error.

The problem it solves. Multinationals often import goods from related companies at a provisional transfer price. They then make year-end transfer pricing adjustments so that the local company earns the arm's-length profit required for income tax. Those adjustments change the price actually paid for the goods, and therefore their customs value, with knock-on effects on customs duty and import VAT. Reflecting them across hundreds or thousands of import declarations needs a workable, legally certain procedure, and the new rules now set one out in binding form.

The new rules. On 11 September 2026, SARS published amendments to the rules under sections 40, 41 and 120 of the Customs and Excise Act, 1964 (Notice R.7900, Government Gazette 55355, DAR279), effective 14 September 2026. They insert rule 40.03 and new rules 41A.01 to 41A.04.

Key definitions:

The process step by step:

Two further points. Warehousing bills of entry are excluded from the CVAC and follow the separate section 40 procedure. And from 14 September, all TP-related adjustments to bills of entry must follow the new rules.

What the levy was. Since 2009, South Africa has charged an environmental levy on electricity generated domestically from non-renewable sources, such as coal, gas and diesel, and from nuclear. It was set out in item 148.01 of Part 3B of Schedule 1 to the Customs and Excise Act. Producers above a capacity threshold had to be licensed as manufacturing warehouses with SARS Excise and self-assess the levy monthly. Renewable generation, small plants and certain co-generation were exempt.

What changed on 11 September 2026. In Government Gazette 55355, SARS published a package that removes the levy entirely:

How to get the money back. The refund is conditional:

1. The licensee must apply to cancel its customs and excise manufacturing warehouse licence with effect from 1 January 2026.

2. With the cancellation application, it must apply for a refund of levy paid for the January 2026 accounting period and later periods.

3. SARS may refund the levy if satisfied that the licensee has complied with all outstanding obligations.

In practice, any unresolved excise accounts, outstanding returns or debts could hold up the refund.

The policy context. The repeal sits alongside the continued rise in South Africa's carbon pricing. The environmental levy on carbon dioxide equivalent rose from R236 to R308 per tonne, also retrospectively from 1 January 2026. Removing a separate per-kilowatt-hour levy on fossil generation simplifies the system, as carbon emissions are increasingly priced directly.

The background. The diesel refund scheme under Schedule 6 to the Customs and Excise Act refunds fuel levies on diesel used in qualifying activities, mainly on-land farming, forestry and mining. Since 1 April 2026, it has refunded 100% of eligible litres, up from 80%. Until now, registration and claims ran through the VAT system: a user registered as part of its VAT registration and claimed on the VAT201 return.

What changed. As part of its Customs Modernisation Programme, SARS has separated diesel refund registration from VAT. Two notices in Government Gazette 55406 gave legal effect to the new system from 18 September 2026, when the registration platform went live. Users and sellers began registering on eFiling from 21 September.

Why SARS is doing it. SARS says a standalone system should give users clearer visibility of registrations, claims, verifications and refund status. It should stop problems with one refund holding up the other. And it should help SARS identify high-risk transactions and reduce fraudulent or unsupported claims. Grain SA and AgriSA have described it as an improvement for both SARS and farmers, provided the technology works.

The risk in the transition. Registration now, claims later is a sensible sequence, but it creates a trap. A user who has not re-registered, or whose diesel supplier has not, may find claims rejected once the standalone platform takes over. Mixed businesses must also separate diesel used in primary production from processing, packing, private use and other excluded activities.

1. Transfer pricing meets customs valuation

Two systems, one price. Income tax and customs both care about the price of goods traded between related companies, but from opposite directions. Income tax authorities worry that the import price is too high, shifting profit out of South Africa. Customs worries that it is too low, reducing duty and import VAT. A single year-end adjustment can therefore increase taxable profit and reduce customs value, or the reverse.

The WTO framework. South Africa's customs valuation rules follow the WTO Customs Valuation Agreement, which accepts the transaction value between related parties as long as the relationship did not influence the price. Post-import TP adjustments raise a recognised question: whether the price "actually paid or payable" includes later adjustments. The World Customs Organization has published guidance on customs valuation and transfer pricing, encouraging administrations to accept TP documentation as evidence and to provide practical procedures for upward and downward adjustments. The new SARS rules follow that direction:

• They provide a symmetrical process, with payment if duty rises and a refund if it falls.

• They use the TP policy and financial data as evidence.

• They apply an adjustment factor across affected bills of entry, instead of requiring line-by-line amendments.

Points of legal tension.

2. Retrospective repeal of the electricity levy

Retrospective tax changes normally raise rule-of-law concerns, but this one favours taxpayers by removing a liability. The legal issues are practical: the refund depends on cancelling the manufacturing warehouse licence from 1 January 2026, and on SARS being satisfied that all outstanding obligations are met. Generators with open disputes or unfiled accounts should resolve them first.

3. Diesel refunds and administrative justice

The new registration rules change who may qualify in practice, because purchases from unregistered sellers will not count. Decisions refusing registration or rejecting claims are administrative action, and claimants are entitled to reasons and to challenge unfair decisions through SARS's dispute processes. The clearest protection, however, is early registration of both user and supplier.

Transfer pricing rules

Multinational importers (automotive, pharmaceuticals, FMCG, electronics, chemicals). Any group that buys goods from related companies abroad and makes year-end TP adjustments must now follow the new process for every adjustment made after 14 September 2026. That means notifying SARS, producing a CVAC within 30 days, and paying within 14 days of acceptance or claiming a refund. Finance, tax and customs teams need to work as one: the TP calculation, the customs value adjustment and the income tax position must tell the same story.

Tax and finance teams. TP year-ends will now trigger customs and VAT cash flows. Build the 14-day payment window into treasury planning, and prepare template packs of agreements, policies and segmented financials in advance.

Customs brokers and registered agents. Agents can submit notifications and CVACs on behalf of importers, especially those not located in South Africa. They must check the data obtained from SARS Trade Statistics and the adjustment factor calculations, and they share the declaration of accuracy.

Foreign related-party exporters. The process starts when the exporter issues an amended invoice or debit or credit note. Group companies abroad need to issue those promptly and in a form SARS will accept.

Importers with downward adjustments. There is now a clear, rule-based route to a refund of duty and VAT when a TP adjustment lowers the customs value, through a voucher of correction for each affected bill of entry.

Electricity levy repeal

Electricity generators using fossil or nuclear sources (Eskom, independent power producers, self-generators above the threshold). The levy no longer applies from 1 January 2026. Generators that paid it this year can claim a refund under rebate item 681.08, but only after applying to cancel their manufacturing warehouse licence and clearing all outstanding obligations. They should calculate refunds from January onwards and file promptly.

Electricity consumers. Removing a levy on fossil generation lowers one component of generation cost. Whether that reaches tariffs depends on Eskom and regulator processes, but the change takes one cost out of the system.

Renewable generators. They were already exempt, so the immediate impact is limited, although removing a levy on competing fossil generation slightly narrows the relative advantage that exemption gave them.

Diesel refunds

Farmers, foresters and miners. Every existing claimant must register again on the new system, through eFiling or a SARS branch. Keep claiming through VAT201 for now, and keep logbooks fully up to date. Confirm that every diesel supplier is registered, because claims on purchases from unregistered sellers will not qualify.

Diesel sellers, distributors and fuel retailers serving farms and mines. Registration is now mandatory for sellers whose customers claim refunds. Sellers that do not register risk losing those customers to registered competitors.

Mixed businesses (farming plus processing, packing or transport). Allocation of diesel between qualifying and non-qualifying activities will face closer scrutiny under the new system. Records must separate primary production from other uses.

Tax practitioners. Practitioners need to run client re-registration projects, map diesel suppliers, and prepare clients for the switch to standalone claims when SARS announces the date.

Across all three

SARS. The three measures share a theme: moving away from ad hoc handling and embedded processes towards dedicated, rules-based systems with better data. SARS gains visibility and audit capacity, while compliant taxpayers gain clearer procedures.

What do the new transfer pricing customs rules require? From 14 September 2026, importers whose customs value is affected by a related-party transfer pricing adjustment must notify SARS. Within 30 days they must submit a Customs Value Adjustment Calculation spreadsheet with supporting documents. If duty and VAT are payable, they must pay within 14 days of SARS's written acceptance; if a refund is due, they claim through vouchers of correction.

Does SARS acceptance of a CVAC protect the importer from audit? No. The rules state that acceptance does not indemnify the importer against later audit findings, fines or penalties.

Is the electricity environmental levy still payable? No. It was repealed with retrospective effect from 1 January 2026. Generators can claim refunds under rebate item 681.08/000.00/07.00 after applying to cancel their manufacturing warehouse licence.

Do existing diesel refund users need to register again? Yes. Registrations do not carry over. Every user and every diesel seller must register on the new system, which went live on 18 September 2026.

How are diesel refunds claimed now? Still through the VAT201 return, until SARS announces the start date of the standalone claims platform.