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- The Samsung Galaxy S7 is a phone, the Pretoria high court ruled.
- The ruling was necessary after Samsung insisted that the S7 is not, in fact, a phone, at least for tax purposes.
- The SA Tax Service originally classified both the iPhone 6S and the Samsung phone into an “other” class of telephone equipment.
- When the tax collector tried to correct that mistake, Samsung tried to present the S7 as more of a laptop than a phone, in an argument the court described as bogus.
- For more stories, visit www.BusinessInsider.co.za.
The Samsung Galaxy S7 is a phone, says the Pretoria high court, even if its maker argues otherwise, in a way the court called “bogus.”
The South African arm of Samsung Electronics had gone to court to compel the SA Revenue Service (Sars) to treat the S7 as telecommunications equipment other than a telephone, for the purpose of calculating import tariffs.
But after considering expert testimony from both parties and the results of Samsung’s survey of how people use their phones, the court concluded that “their primary function is telephony” and that there was no compelling argument “the product is a machine that is not a smartphone. ” “said Judge Nomonde Mngqibisa-Thusi.
Samsung’s efforts were dismissed with costs.
Sars had initially categorized the S7, as well as the Apple iPhone 6S, in a tax class reserved for telecommunications equipment that does not function as telephones, formally described as “machines for the reception, conversion and transmission or regeneration of voice, images or other data”.
When Sars later realized that the S7 is something else, a tax code described as “phones for cellular networks or for other wireless networks designed to be used when carried by hand or on the person,” it changed the tax treatment of retroactively imported phones.
Samsung insisted that Sars had been right the first time. Yes, the company said, the S7 could make phone calls, but its main function is actually to connect to the Internet and allow the use of social networks and the playing of games and music, not to make phone calls.
Also, most people don’t use it to make traditional phone calls, Samsung said.
Sars replied that making a call via WhatsApp or Skype still uses a phone as a phone, and it looks like a phone. It has “a loudspeaker at one end that is audible when placed against the operator’s ear and at the other end it has a microphone to receive speech or voice from the operator’s mouth,” the tax service told the court.
The court agreed, finding that a telephone is still a telephone because it also includes features found on laptop or desktop computers.
(Compiled by Phillip de Wet)
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