SARS to engage industry on shortage of jet fuel

The South African Revenue Service (SARS) says it will engage with the fuel industry to avert the shortage of jet fuel, known as kerosene.

This comes after a warning by the Fuels Industry Association of South Africa that the supply of aviation kerosene is facing severe threat due to regulatory delays in the licensing of import storage facilities.

While SARS has noted media statements alluding to the pending shortage of kerosene, it has denied assertions that the shortage is due to what is purportedly SARS’ ‘dithering to issue licences to fuel companies’.

“This is an incorrect position. The importation and movement of both aviation kerosene and illuminating kerosene is strictly governed by the Customs and Excise Act [91 of 1964]. It is the adherence to the provisions of the Act that has proven difficult for the fuel industry.

“SARS wishes to clarify that the demand for both aviation kerosene and illuminating kerosene in the Republic is met by the supply from licensed fuel manufacturers (‘refineries’) and importation,” SARS said yesterday.

Since 2022, some of the coastal refineries have stopped manufacturing for various reasons, including the destruction of infrastructure, and have relied on importation to meet the demand.

“During April 2024, some of the refineries applied for and were granted temporary special storage warehouse licenses for the storage and subsequent distribution of imported aviation kerosene to OR Tambo International Airport and other airports. This was done to avert an impending crisis of the shortage of aviation kerosene that was occasioned by statutory maintenance of certain refineries,” SARS said.

The licenses granted were for a specific period and under specific conditions at that time.

“These licenses were granted on the premise that the institutions would follow the formal process for licensing and have the necessary facilities in compliance with the customs and excise legislation. The special customs and excise warehouse ensures control of goods and enables SARS to protect the state’s revenue.

“SARS has endeavoured to provide clarity and certainty to the relevant entities that are transitioning from a manufacturing-based model to an import model. In this regard, SARS has been assisting and guiding the entities to continue to trade within the bounds of the law while adhering to the necessary governance processes,” SARS said.

SARS said it will be engaging with industry to announce a solution to immediately implement measures that will address the current challenges while ensuring that the provision of the law is upheld.

“It is in SARS’ interest that the country’s economy and travelling is not impeded in any way. It is equally important that all the role players should also act expeditiously in meeting their obligations,” the revenue service said. – SAnews.gov.za