By Lee-Yandra Paulsen
The Fair-Trade Independent Tobacco Association (FITA) remains optimistic about its legal battle against the South African Revenue Service (SARS) regarding the installation of CCTV cameras in tobacco manufacturing warehouses. This issue returned to court after SARS sought leave to appeal a High Court ruling from May 2023, which had granted an interdict halting the implementation of the new regulations.
FITA Chairman Sinenhlanhla Mnguni explained, “In 2021, SARS gazetted rules requiring CCTV cameras in cigarette manufacturing warehouses. We submitted comments in the hope that SARS would withdraw the proposed rule. However, despite our submissions in 2022, SARS proceeded to implement the rules, giving them the force of law within 30 days.”
FITA subsequently filed a court application to review and set aside the rule amendment on constitutional grounds. “We argue that this rule infringes on our rights to privacy and property, particularly regarding the privacy of our employees. Moreover, it is not a globally applied law, lacks rationality, and is arbitrary in nature.”
Mnguni also addressed SARS’ reasoning behind targeting tobacco factories with this regulation. “This issue stems from allegations of rampant illicit trade in the tobacco industry. While we acknowledge that illicit trade exists, our intelligence, supported by media reports, indicates that smuggling occurs mainly through border posts, not within local manufacturing facilities. Even SARS has not presented any evidence of non-compliance among local manufacturers.”
He emphasized FITA’s concerns over SARS’ insistence on implementing the rule. “We’ve tried to engage with SARS to find common ground, but these efforts have been unsuccessful. SARS seems intent on using this regulation as a way to recover much-needed tax revenue.”
Mnguni added that, in his view, a more collaborative approach could have been taken. “I believe this situation could have been handled more effectively if the industry and SARS had worked together to find solutions for addressing the tax gap.”
VOC News
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