South Africa has been rapidly cracking down on Temu and Shein to protect local industries.
While South Africans may have recently benefited from Temu and Shein’s extremely low pricing, this is coming to an end as regulators and policymakers begin to crack down on the Chinese e-commerce platforms.
As beneficial as this may sound for the South African public, especially during a time of tremendous pressure on the average consumer’s purse, the local industry warned that it would cost local jobs in the long term. To protect the local industries and level the playing field, Sars began applying VAT in addition to the 20% duty to all low-value packages from 1 September.However, National Clothing Retail Federation executive director Michael Lawrence said South Africans needed to look at the bigger picture.Lawrence said his organisation represents “far more vulnerable consumers” in the retail world, many of whom are employed within the manufacturing sector and positively affected by the taxes.
One Temu customer recently found that Sars has potentially already implemented a 45% duty with VAT on Temu clothing parcels valued under R500. However, this has had mixed results. Temu and Shein’s local logistics partner, Buffalo Logistics, told MyBroadband that order volumes have beento create a level playing field in the country’s e-commerce sector, saying the government will need to employ all of its tools.
“Their ability to offer lower prices due to these loopholes has significantly undermined our competitive position,” Van Greuning said.
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