Why SARS took a gold refiner to court, and won

The South African Revenue Service (SARS) has secured a Constitutional Court ruling

The South African Revenue Service (SARS) has secured a Constitutional Court ruling confirming that recycled or previously manufactured gold does not qualify for VAT zero-rating.

This followed a dispute involving Lueven Metals (Pty) Ltd, a gold refiner, which supplied refined gold bars to a registered bank and treated the sales as VAT zero-rated.

The revenue service disputed this, arguing that the gold originated from previously manufactured items such as jewellery and therefore did not meet the requirements set out in the Value-Added Tax Act.

The High Court ruled in favour of SARS, and the Constitutional Court has now unanimously upheld that decision.