Ricochet News

Afrox Coega investment approved for 12i Tax Allowance Programme

OCTOBER 3, 2014
Afrox Coega investment approved for 12i Tax Allowance Programme

The R200 million African Oxygen Limited (AFROX) Air Separation Unit at the Coega Industrial Development Zone (IDZ), has been approved for the 12i Tax Allowance Programme.

Approval of the application has been published in the Government Gazette by Trade and Industry Minister Rob Davies, after having been approved on May 6.

Afrox will manufacture Liquefied Nitrogen, Liquefied Oxygen and Liquefied Argon.

The Gazette states that the total investment is R320.4 million with the value of qualifying assets R319.7 million.

The qualifying assets are made up of R88.5 million for “owned buildings” and R230.8 million for plant and machinery.

Davies has also approved a further amount of R720 000 as an additional training allowance over a period from May this year to May 2020.

He says that total potential national revenue that will be foregone as a result of the deduction of the approved allowances by Afrox is R67.3 million.

The tax benefit is designed to support Greenfield and Brownfield investment and offers support for both capital in-vestment and training.

Afrox signed a lease agreement with the Coega Development Corporation in 2013 and broke ground on its 150-ton-a-day state-of-the-art air separation unit in February this year.

Afrox MD Brett Kimber said at the time of the investment that it would service industry and health services across the Eastern Cape.

He said that demand for Afrox products was “already high” in the Eastern Cape and “we expect this to increase”.

Kimber noted that currently demand was met by trucking in industrial gases.

The investment, he said, confirmed the company’s commitment “to support existing and new companies in this crucial industrial development zone”. - metrominutes