Tax In Brief | Issue 114

case law

• Ken CC v CSARS VAT2218 (VAT) [2023] ZATC CPT
• • This case concerns the taxpayer's appeal to the Tax Court against additional VAT assessments raised by the Commissioner for the South African Revenue Services ("SARS") concerning the supply of services to foreign tour operators ("FTOs") incorporated outside of South Africa.
  • The taxpayer, being a registered VAT vendor, argued that it provides a single supply of tourism package assembly services to its FTO customers outside South Africa and accordingly the services were zero-rated under section 11(2)(l) of the Value Added Tax Act, 1991 ("VAT Act"). In regard to the local services (such as accommodation, guides, greeting services) contracted for by the taxpayer on behalf of its FTO customers as part of its package assembly function, the taxpayer contended it acted as agent on behalf of the FTOs and did not itself supply the services (which would be subject to the standard rate) to the FTO as principal.