Shaky start to voluntary customs ‘pre-declaration’ process in SA

Too many questions and too few answers has created a lot of mistrust about the new pre-declaration process that will be phased in at all ports of entry in the country from next year.

The tourism industry was caught on the back foot when news of the South African Traveller Management System became public. Those in the expat community also voiced concerns about the process.

The South African Revenue Service (Sars) says the system is part of a broader customs modernisation programme and seeks to provide “pre-clearance” for travellers to and from SA.

Aiming to address the confusion in the public domain, the revenue service issued a statement at the end of last week in which it clarifies the process.

Pilot project

Sars will launch a pilot project at King Shaka International Airport on 1 November, that allows travellers to pre-declare goods – whether purchased, received or “otherwise” acquired – on an online portal before entering or leaving the country.

“Sars is of the view that the process of pre-declaration will enable travellers to have a swift and seamless movement when they arrive, and those departing, will also experience a smooth boarding process,” it says in the statement.

The Southern Africa Tourism Services Association (Satsa) was initially quite outspoken about the new process and how it has been dealt with. On Friday, following Sars’s clarification statement, Satsa chief operating officer Hannelie du Toit said it was seeking further clarity from Sars on the issue. “It would be premature for us to weigh in just yet,” she added.

Confusion, and old rumours

Hugo van Zyl, independent tax and exchange control specialist, says it is a pity the announcement was clouded by uncertainty and (contained) wrong information. It created mistrust, he says.

“I am not against digital transformation, but the manner in which it has been dealt with is concerning. The question is whether the right legislation is in place, how secure is the system, and how will the government agencies share the information?”

He refers to the previous travel card, saying there were lots of rumours the information on these cards was leaked to organised criminals who targeted and hijacked visitors to South Africa at OR Tambo International Airport in Johannesburg.

“How secure will the new system be, as we know the criminal factor at our airports is quite pertinent?” he asks.

“We do not have answers, only more questions.”

Sars says travellers who choose not to use the online portal on their mobile devices will be able to fill in a form and there will also be self-service counters at the airport terminals.

Customs officers will also have hand-held devices to assist travellers and to “facilitate passage”.

‘Smart’ borders

Sars says it aims to create “SMART borders” as part of its modernisation programme.

This will require certain interventions such as:

• Collaboration with airlines for access to additional sources of passenger data, in order to enhance its risk profiling;
• Deploying scanning equipment to automate the management and monitoring of trade and travel through the borders; and
• The implementation of a “single window” that can be used by government departments to simplify the submission of required declarations and to exchange information among government agencies.

Some media articles hinted at the fact that the government is pulling out all the stops to ensure that SA is not greylisted by the Financial Action Task Force (FATF).

The FATF found several deficiencies in SA’s policies to combat money laundering and terrorism financing.

Van Zyl says he will not deny the possibility that the November pilot at King Shaka airport could be related to government efforts to tighten financial regulations to prevent the country from being greylisted.

“In principle I do not have a problem with the new process, because we need to ensure that criminal elements are not allowed to flourish in SA.”

Customs is responsible for the “monitoring of financial flows through ports of entry, to detect and make it costly for those engaged in illicit financial flows and to enforce the country’s laws and regulations”.

Sars says travellers who have not submitted pre-declarations will still be allowed to enter or leave the country, but are “encouraged” to voluntarily declare pre-departure to avoid the inconvenience of making a declaration at a port of entry.

Integrity of SA’s financial system

Sars Commissioner Edward Kieswetter says other countries such as the US, New Zealand and Australia have already implemented similar systems.

He believes the system will assist in maintaining the integrity of the domestic economy and contribute to the integrity of the country’s financial system.

Engagements between Sars and the relevant stakeholders will continue to address any challenges or concerns.

The online declaration system will be fine-tuned during the pilot phase and progressive implementation across all South African ports of entry will begin from April next year.