I still remember sitting in those boardrooms, staring at global pricing spreadsheets that made my stomach turn. A flagship device in the US: $1,299. Then I’d see the South African price next to it.
Even after converting the currency, the numbers just didn’t add up. It was thousands of rands more than it should’ve been.
Back then, I was on the inside—part of the corporate machine trying to justify those margins. Now that I’ve swapped the suits for shorts and flip-flops at Geekhub’s editor’s desk, I can finally say what everyone in the industry whispers: South Africa isn’t just dealing with a “weak rand” problem. We’re being squeezed by a system that stacks cost upon cost, and it’s quietly strangling our creator economy.
Let me be clear: This isn’t about wanting the latest shiny gadget. We’re in 2026 and a MacBook isn’t a luxury flex anymore—it’s a paintbrush. Our smartphones are our cameras, our publishing platforms, our recording studios all in one. These are work tools in every shape and form for many people. And when those tools cost 30% to 50% more here than in Dubai or Taiwan, we’re not just taxing product, but taxing South Africans’ ability to participate in the modern world.
Layer One: When SARS Treats Your Laptop Like Champagne
The rot starts with government policy. SARS still looks at a high-end laptop or flagship smartphone and sees it as a luxury item, much like expensive champagne. So we get slapped with ad valorem excise duty, around 9%. But hold on, that’s applied before VAT
Then comes the 15% VAT which is not calculated on the base price—it’s charged on a customs value that already includes the duty and a “notional uplift.” By the time a premium device clears the port, you’re looking at an effective tax burden of nearly 30%.
Communications Minister Solly Malatsi has been pushing back on this outdated thinking. He’s been trying to get Treasury to understand that smart devices are economic infrastructure, not toys for the wealthy—and I respect him for it. But like most things in South Africa, change moves at a glacial pace. Sure, the government scrapped the 9% luxury tax on smartphones under R2,500 in 2025, which helps with accessibility. But it does absolutely nothing for the creator, the developer, or the entrepreneur who needs a machine with real power.
The policy treats serious tech as a lifestyle upgrade. But for a freelancer in Joburg or a designer in Cape Town, it’s their shovel. And we’re making those shovels too expensive to dig with.
Layer Two: The Channel Margin Stack (The Silent Killer)
But taxes aren’t the whole story. Even if SARS dropped every tax tomorrow, your tech would still be overpriced. Why? Because once the taxman takes his cut, the product enters “the channel”—a messy, expensive relay race of middlemen.
In the US, a retailer often buys directly from the manufacturer. In South Africa, the chain is longer and way more fragile than the rand itself.
1. The Global Vendor: Apple, Samsung, and the rest set a dollar price. They don’t care about our currency volatility—they push that risk downstream.
2. The Local Distributor: This is where things get uniquely South African. Companies like Mustek, 3g Mobile, or Core Group finance massive shipments months in advance. They carry all the “rand panic” risk. If the rand drops 10% in a week—which happens more often than we’d like—their margins vanish. So they build in a 10% to 15% risk buffer. Look, it’s not greed—it’s survival. But it means when the rand strengthens, prices stay high because they’ve already paid the “weak rand” price for the stock sitting in their warehouse.
3. The Retailer: The store in the mall takes its cut too. They’re dealing with insane rental costs, generator investments, and theft. By the time you tap your card, the product has passed through three or four hands, each adding a layer of “South Africa insurance.”
4. The Hidden Marketing Tax: Here’s something most people don’t know: you’re paying extra for store staff to recommend products to you. Most brands pay incentives to sales consultants to push their gear—sometimes as much as R1,000 to R1,500 per flagship device. And yes, that gets baked into the price you pay. What’s worse: in our hyper-competitive market, brands without massive budgets often don’t get recommended at store level, even if they have a better product.
The Geography Penalty
Then there’s simple geography. Dubai is a global shipping hub—containers land there cheaply. We’re at the bottom of the world, and shipping to Durban costs more.
But it gets worse. Our ports move at a snail’s pace, thanks to years of corruption and mismanagement at Transnet. And because of our high crime rate, inland transport needs security escorts and extra insurance. Every single one of those headaches shows up as a line item on your receipt.
Why This Actually Matters
This isn’t some “first-world problem.” It’s an access crisis.
When a $1,299 MacBook becomes a R40,000 mountain to climb, we’re gatekeeping creativity. A student filmmaker in Soweto can’t upgrade. A startup designer in Khayelitsha struggles with a laggy, underpowered PC. A YouTuber edits on a phone that’s literally burning their hand because it can’t handle 4K rendering.
We talk big about “Silicon Cape” and digital innovation, but we price the tools of innovation like they’re imported jewelry. This ensures South Africans remain consumers of technology (those who can afford it) rather than creators. Even now, with AI taking over, we’re importing intelligence that doesn’t understand us or cater to our unique challenges. But that’s a conversation for another day. The point is, these policies are choking progress and growth.
The Great Bypass
There’s a shift happening. South Africans are going direct. People are skipping the local distributor and mall overhead entirely, ordering from Amazon Global using their Delivered Duty Paid (DDP) service or forwarding companies in tax-free US states. Even with shipping, it’s often cheaper than buying down the road. I’ve done it myself multiple times. It’s not just a “hack” for tech nerds anymore, but a form of economic self-defense.
The Bottom Line
Minister Malatsi is right to challenge the tax logic, but we need to go deeper. We need to stop viewing tech through the lens of consumption and start seeing it as an engine of production.
We’ve tackled the electricity crisis (sort of). We’ve expanded fiber and mobile coverage. Now we need to fix access to the machines that actually use that power and bandwidth. A country that overprices its tools is choosing to move slower than the rest of the world.
Our creators are ready to build the future. We just need to stop making them pay a premium for the privilege of getting started.
