South Africa Proposes Ending E-Commerce Tariff Moratorium

South Africa recently submitted paperwork at the World Trade Organization saying it wishes to end the moratorium on charging tariffs on electronic transmissions, arguing that it provides global tech firms with a "distinct unfair tax advantage over local competitors in developing countries," and also deprives countries where those purchases are made of corporate tax revenue. South Africa said the international taxation being considered for tech giants is a useful step, but "will not result in developing countries individually benefiting to any material extent and does not resolve the fundamental problem generated primarily by the lack of digital tariffs which can enable more sustainable promotion of investment in developing countries."

A decision on tariffs on in-app purchases or digital subscriptions will be made at the next ministerial conference of the WTO in February. South Africa also resisted renewing the moratorium at the last ministerial conference, but ultimately acquiesced to the majority view. Because the WTO operates by consensus, not by a majority vote, South Africa could end the moratorium (see 2206100070 and 2311200078) if it chose to.

There never have been customs duties charged on intangible goods' sales, going back to 1998.