South Africa has officially closed a tax breach that allows global titans such as Shein and Temu to ship ultra-cheap products into the country, thereby avoiding VAT and import duties.

This move is already causing a stir in the fashion and e-commerce sectors.

The change is beginning to level the playing field, and local retailers are exhaling a sigh of relief.

For years, consumers were able to order apparel and electronics from China for under R500 and pay only 20% in customs duties, with no VAT.

This enabled companies such as Shein to significantly undercut local pricing, thereby exerting pressure on South African brands that were already grappling with increased costs and taxes.

“It was akin to competing with a ghost,” stated Thandi Modise, a boutique proprietor based in Durban.

Some customers have begun to protest against the e-commerce behemoths’ increasing costs and extended delivery times since the rule change.

According to Mr. Price and TFG, their online conversions and foot traffic have already improved. One executive at a prominent local chain stated, “It’s a small change, but we are noticing it.”

This is not solely about profit; it is about survival for numerous modest enterprises. Thandi disclosed, “I was obliged to terminate two tailors last year.” “I may reinstate them if the situation persists.”

Additionally, the modification initiates conversations regarding the development of more robust local supply chains and the promotion of African-made fashion..”

The South African Revenue Service’s message is unequivocal: global platforms must adhere to fair play.

For the first time, it appears that the system is providing support to local entrepreneurs who have been waiting for an equal playing field for an extended period.