NewCustomsTariffCalculator

ImplementationofFormulas
Introductionandpurposeofthisdocument
In legal tariff publications, duty rates are described as text, for example "free" or "Full duty less
10%".Thistypeofformulaisdifficulttoparsesothatanautomatedsystemcanusethemtocalculate
duties. Also, because formulas were entered as freetext, there are subtle differences in the text
representingthesametypeofcalculation.

In the new Tariff Calculator Module implementation of the TATIScms product the duty rates are
consolidatedsothatthesametextwillappearconsistentlyforthesamerate,e.g."free"and"Free"
is now all set to "Free". A mechanism was also developed that represents the textual duty rate
descriptioninacomputerreadableform.

Tradersandotherrecipientsoftariffmeasuresextractedfromtheelectronictariffwillneedtoknow
how to interpret the duty formulas, either for manual calculations or for use in their automated
systems

ThisdocumentdescribeshowformulasareimplementedinthenewSARSTariffCalculatorModule
thatwillformpartoftheCustomsModernisationprogramme.

Concepts
ThenewTariffDatabase(DB)willstoretwoformulas:

ThefirstformulaiscalledthePrintedFormula.Thisisaformulainthesameformatasitis
currently printed in the Tariff Schedules 1 to 6. The Implementation Team, together with
SARS,isintheprocessofcleaninguptheformulasandmakingthemconsistentthroughout
Schedules1to6.
ThesecondformulaiscalledtheCalculationFormula.Thisformulacanstillbeinterpretedby
aperson,butitcanalsobereadbytheTariffCalculator.

ThereisaonetoonemappingbetweenthePrintedFormulaandtheCalculationFormula.Bothof
theseformulasarestoredforeachdutyratemeasurecreatedintheTariffDB.Legalpublicationsof
tariffintheGovernmentGazetteorinPDFdocumentswillshowthePrintedFormula,whiletheTariff
CalculatorinTBKwillusetheCalculationFormula.

The table below shows typical examples of a Printed Formula and its corresponding Calculation
Formula.Anexplanationofallthetermsusedfollowsinthesubsequentparagraphs.

1|P a g e

No PrintedFormula CalculationFormula1
1 40% 40%*:CV[c]
2 60%or2500c/kg max(60%*:CV[c],2500[c/KG]*:[KG])
3 14,3c/kgless80%witha min(14.3[c/KG]*:[KG]80%*:CV[c],4.81%*:CV[c])
maximumof4,81%
4 Fulldutytotheextentspecified :AA[c]*100
inthecertificateissuedbyITAC
5 Fulldutyless10,8% :OCD[c]+:EXC_CST[c]+:AVE_CST[c]+:DAD[c]+:DCV[c]
+:SAF[c]10.8%*:CV[c]
6 R75perg/kmCOemission 7500[c/GK]*(:[GK]120)
exceeding120g/km
7 VATBLNScountries INT((:CV[c]+:NRD[c]+49)/100)*14%*100

FundamentalRules
1. TheminimumCustomsValuethatcanbedeclaredisR1.00.CustomsValueisdeclaredinZA
Rand.
2. CalculationresultsarereturnedasSouthAfricancents,roundeduptothenearestcent.
3. VAT and Ad Valorem calculations round 51cent upto the nearest 100 cent before the
percentagecalculationisapplied.
4. CommodityCodesarestoredintheTariffDBandprintedinlegalpublicationswithoutany
decimalpoints.

DefinitionsinTBK
1. AdditionalCode:ThecurrentSchedulescontainItemCodesforthepartsofSchedule1,Item
andCodeforSchedule2andRebateItemandRebateCodeforSchedules3,4,5,and6.Allof
thesecodes areloadedasanAdditionalCodeinthenewTariffDB.Whereapplicable,the
RebateItemandRebateCodeareconcatenatedintoasinglecode.
2. ProcedureMeasure:The AdditionalCoderequiredindeclaringarebate,isindicated inthe
declarationlineitemasPMR(ProcedureMeasure)forEDITransactions.
3. Units of Measure: Units of Measure are the Statistical Unit that must be declared for
Schedule1Part1,andanyotherUnitsofMeasurerequiredincalculatingduties.SARSCode
list5,refertoAppendixAforanexample),definesalltheStatisticalUnitsthatmaybeused.
ATariffLineItemcanhaveuptothreeUnitsofMeasure.

HowtheTariffCalculatorWorks
Thisisahighleveloverviewofthestepsperformedtocalculateduties.

1
Theseformulasareforillustrationpurposesonly,theyarenotyetratifiedbySARS

2|P a g e


1. Retrieve all measures that match the input for a goods line item Commodity Code,
PreferenceCode,CountryofOriginandSubmissionDate.
2. IfameasureisprohibitedforanImport,ExportorTransitProcedureCategoryCode(PCC),
no duties are calculated. A PROHIBITED flag is set and any required documents associated
withtheProhibitedMeasurearereturned.
3. In some instances TBK cannot calculate duties and taxes, for example the Old Southern
Rhodesian/MalawiTradeAgreements.Forthesecases,TBKreturnwithastatusmessageof
MANUAL_CALCULATION.
4. IfaPreferenceCoderequestspreferentialratesduetoatradeagreement,butnoRulesof
Origin(ROO)certificateisdetectedintheinput,TBKfailsthecalculation(becausetheTariff
Calculatordoesn'tknowwhetherthepreferencecodewassuppliederroneouslyornot).The
failuremessagewillstateaROOcertificateismissing.
5. ForSchedule1andallitsparts,noadditionalcodeisrequiredtocalculateduties.
6. If the Measure Types returned include Schedule 2 duties (Antidumping, Countervailing or
Safeguarding)andnoAdditionalCode(ItemCodeinSchedule2)wasprovided,TBKwillnot
calculateSchedule2duties,butwillflagInspectionthatSchedule2dutiesmaybeapplicable
depending on the manufacturer/supplier of the goods. If a Schedule 2 Additional Code is
provided,Schedule2Dutiesarecalculated,andInspectionisnotflagged.
7. IfaProcedureMeasureisprovidedbutisincorrectforthePCC/CPCcombination,TBKwill
failthecalculation.
8. If a Procedure Measure is not provided, where there could have been a rebate given, no
rebateswillbecalculated.ProcedureMeasuresarerequiredtocalculateandapplyarebate.
9. CalculationsareperformedforeachMeasureType(eachschedule)ofthemeasuresthatare
returnedinthefirststep.ArunningtotalofNonRebatedDuties:NRD[c]iscreatedwhichis
finallyusedtocalculateVAT.
10. Thefinaldutyisdeterminedforeachofthedutymeasuresandreturnedascentamounts,
roundeduptothenearestcent.
11. VATiscalculatedandreturnedasacentamount.IftheCommodityCodeisVATExemptedor
Zero Rated, a flag is set to indicate VAT EXEMPT status and the VAT amount of zero is
returned.
12. Ifthereareanyimport,exportortransitrestrictions,thedeclarationlineitemisscannedfor
theexistenceoftherequiredpermits.TBKwillreturnwithalistofallthepermitsrequiredas
wellasOtherGovernmentAgenciesthatwillparticipateinclearingthegoods.

CodesusedinCalculationFormulas
TBKhasastructuredwayofconvertingthePrintedFormulasintoCalculationFormulas.Thissection
describesthedifferentelementsoftheCalculationFormula.

Aformulaconsistsofconstants,variables,functionsandmathematicaloperators.

3|P a g e

Constants
A constant is something like 60; 5.15 or 2000. A constant is qualified by using a percent sign for
percentagevalues,ortheUnitofMeasureusedinacalculation.PleasenotethatallRandvaluesin
the "legal" schedules are converted to cent. For example R1.15 will be stored in the Calculation
Formulaas115.

Someexamplesofconstants:

Constant Description
60% Arateof60percentiscalculated.
7500[c/KG] Arateof7,500centforeachkilogramisapplied.
56[c/SM] Arateof56centforeachsquaremetreisapplied.

Variables
A variable is defined by a colon, the variable identifier, and the units of the variable in square
brackets. Examples are : CV[c] which represents the customs value in cent and :OCD[c] represent
OrdinaryCustomsDutyincen.

Input variables read in from a declaration line itemare the Customs Value, stored in : CV[c]; the
valuesofUnitofMeasures,storedin:[KG]or:[NO]asthecasemaybe;ortheamountforDutyCredit
CertificatesorRebateCreditCertificates,storedin:[AA].

While the tariff calculator performs calculations, variables are created and used to store interim
results.ThusSchedule1Part1Dutiesarestoredin:OCD[c].

TherearenospecificvariablesdefinedforRebates.Ifaspecificdutyisrebated,forexample,Specific
CustomsDuties,therebateamountissubtractedfromthecalculatedSpecificCustomsDutyandthe
netresultisthencarriedforwardtodetermineVAT.TheCalculationFormulaforaRebatedutyrate
willshowallthedutiesthatarerebated.Anexampleofarebateddutyrateisdescribedinthelast
sectionofthisdocument,(ExampleCalculationRevisited).

Thetablebelowdescribessomeofthemostprominentvariables.

CalculationFormula Description
Variable
:CV[c] Input:CustomsValueincent
:AA[c] Input:DCCorRCCamountreadfromthedeclarationline,incent
:[KG] Input:kilogramvaluereadfromthedeclarationline.
:[LA] Input:litreabsolutealcoholvaluereadfromthedeclarationline.
:OCD[c] CalculationVariable:OrdinaryCustomsDuty(Schedule1Part1)in
cent
:EXC_CST[c] CalculationVariable:SpecificCustomsDuties(Schedule1Part2A)in
cent
:AVE_CST[c] CalculationVariable:AdValoremCustomsDuties(Schedule1Part2B)
incent

4|P a g e


CalculationFormula Description
Variable
:FUL[c] CalculationVariable:FuelLevy(Schedule1Part5A)
:RAF[c] CalculationVariable:RoadAccidentfundLevy(Schedule1Part5B)
:DAD[c] CalculationVariable:DirectAntiDumpingDuties(Schedule2Part1)
:DCV[c] CalculationVariable:DirectCountervailingDuties(Schedule2Part2)
:NRD[c] CalculationVariable:Avariablethatcontainsalldutiesnotrebated,in
cent.Thisvalueisaggregatedwithdutiesduringthetariffcalculation
processwhilerebatesaresubtractedfromthisamount.IntheVAT
calculationthisamountisthenusedasthefinalamountforVAT
calculation.

CalculationFormulaFunctions

Notetheuseofcapitalstheseareessential!
ThefollowingfunctionsarecurrentlyavailableforuseinTariffCalculations.Itispossiblethatnew
functionsmaybeaddedinfuture.

Function Description
min(a,b) Theindividualvaluesarecalculatedandtheminimumvalueisselectedasthe
result.
max(a,b) Theindividualvaluesarecalculatedandthemaximumvalueisselectedasthe
result.
ROUND(a) Theresultisroundedupwardstothenextintegervalueofadecimalvalue,for
example0.5centisroundeduptothenextcent.
INT(a) Theresultistheintegerpartofavalue;noroundingisperformedonthevalue.

MathematicalOperators
All"normal"mathematicaloperatorsareallowed:multiply,divide,add,subtractaswellasbrackets.
Thepriorityofoperatorsis(1)brackets,(2)multiplicationordivisionand(3)addingorsubtracting.

Examplecalculationsrevisited
The table below contains the same examples cited before, but with explanations of the formulas.
Please note that SARS is still in the process of testing and verifying these formulas, some of them
(rebatedforexample)maynotyetconformtoallrebateconditions.

No PrintedFormula CalculationFormula2
1 40% 40%*:CV[c]

Forty percent of the customs value is calculated and returned in

2
Theseformulasareforillustrationpurposesonly,theyarenotyetratifiedbySARS

5|P a g e

No PrintedFormula CalculationFormula2
centasthefinalduty.

VATiscalculatedonthefinalduty.
2 60%or2500c/kg max(60%*:CV[c],2500[c/KG]*:[KG])

The"or"meansthemaximumofthetworesultsshouldbeusedas
thefinalduty.
TBK calculates 60% of Customs Value; then multiplies 2,500 cent
with the kilogram amount supplied in the declaration line,
comparesthetworesultsandreturnsthemaximumofthesevalues
asthefinalduty.

VATiscalculatedonthefinalduty.
3 14.3c/kgless80%with min(14.3[c/KG]*:[KG]80%*:CV[c],4.81%*:CV[c])
amaximumof4,81%
TBK uses the kilogram amount from the declaration line and
multipliesthisby14.3cent.TBKalsocalculates4.81percentofthe
customsvalueandcomparesthetwovalues.Theminimumamount
ofthetworesultsisreturnedasthefinalduty.

VATiscalculatedonthefinalduty.
4 Fulldutytotheextent :AA[c]*100
specifiedinthe
certificateissuedby The amount from the DCC (only one allowed) or RCC's (multiple
ITAC allowed) on the declaration line is subtracted from the total duty
calculated.Theremainderisthenreturnedasthefinalduty.

VATiscalculatedonthefinalduty.
5 Fulldutyless10,8% :OCD[c]+:EXC_CST[c]+:AVE_CST[c]+:DAD[c]+:DCV[c]+:SAF[c]
10.8%*:CV[c]

Note:
Thisformulamaynotbecompleteforallscenariosoffullduty.

Dutiesarecalculated,storedineachduty'svariableandaggregated
in: NRD[c]. To calculate the final Non Rebated Duty, the
CalculationFormulaaboveisthenSUBTRACTEDfrom:NRD[c].

Thus:
:NRD[c]=:NRD[c](:OCD[c]+:EXC_CST[c]+:AVE_CST[c]+:DAD[c]
+:DCV[c]+:SAF[c]10.8%*:CV[c])

The net effect of this step is that all duties are subtracted from:
NRD[c](thusmakingiszero)while10.8%ofCustomsValueisadded
back to: NRD[c]. The final duty returned is then a rebated duty of

6|P a g e

No PrintedFormula CalculationFormula2
10.8%ofCustomsValueinthisexample.

VATiscalculatedonthefinalduty.
6 R75perg/kmCO 7500[c/GK]*(:[GK]120)
emissionexceeding
120g/km TheCarbonDioxideemissionsamountdeclaredinthedeclarationis
subtracted from 120 and multiplied by 7,500 cent to produce the
Schedule1Part3Dduty.
7 VATBLNScountries INT((:CV[c]+:NRD[c]+49)/100)*14%*100

ThisistheVATformulaforcalculatingVATforBLNScountries.The
customsvalueincentisaddedtothenonrebateddutiesincent.49
centisaddedtorounduptothenextrand.Thisresultisdividedby
100andthentheintegeramountofthisresultismultipliedby14%
tocalculatetheVATamountinroundedcents.

FornonBLNScountries,theCustomsValueisfirstupliftedby10%
priortocalculatingVAT.

IfacommodityCodehastheVATExemptflagsetfortheperiodin
which the calculation is performed, the VAT Amount of 0 is
returnedandtheVATEXEMPTflagissetinthedeclarationline.

7|P a g e

AppendixA

CodeList5StatisticalQuantity
AbsoluteAlcohol AA
Area(m2) SM
Barrels NO
BrushWidth BW
ButtonSize BS
Carat CT
Cards CR
Containers(Matches) NO
Each NO
ElectricCurrent(GW.h) GW
GramsEthambutolHydrochloride GE
InternationalUnit IU
Kilowatt KW
Length(cm) CM
Length(m) ME
Length(mm) MM
LitreGrossStorageCapacity GS
Mass(g) GR
Mass(kg) KG
Mass(t) KK
MassNet(kg) KN
MassNet(g) GN
MedicalUnit MU
Number NO
Packs NO
Pairs(2u) PR
Parts NX
PercentageLocalContent LC
PercentagePropylAlcohol PA
RelativeDensity RD
Sets NO
Units(u) NO
VolumeAA(l) LA
Volume(l) LI
Volume(ml) ML
Volume(m3)(m3/101.3kP) MC
1000kW.h MW

8|P a g e