Online GST inquiry kicks off

[*wheels*]

http://www.zdnet.com.au/online-gst-inquiry-kicks-off-339309253.htm

The Productivity Commission has begun its "Economic Structure and Performance" inquiry into online retailing, which will look into whether to change the taxation rules for online purchases from offshore sites.

The government first announced the inquiry in December last year as a response to growing resentment from Harvey Norman founder Gerry Harvey and a number of bricks-and-mortar retailers over the fact that goods under $1000 purchased online from stores overseas don't attract GST.

The inquiry is being headed up by former Orica CEO and managing director Philip Weickhardt as well as former Australian Consumers' Association CEO Louise Sylvan. The terms of reference for the inquiry, announced by Assistant Treasurer Bill Shorten earlier this month, state that the inquiry will examine the impact of globalisation, increases in online purchasing by Australian consumers, as well as the current tax arrangements of imported goods and the effect it is having on the Australian retail industry.

The commission will also look at what technology could be used to reduce the administrative costs of collecting taxes on imported goods. Shorten has previously stated that ensuring every imported good was subject to the GST would be too costly for the government to administer.

In a circular produced late last week, the commission announced it intends to release an issues paper on the inquiry by the end of next month, and will accept submissions from the public until 20 May. A draft report will be produced by August, with public hearings set for September before a final report is handed to the government in November.

The announcement was welcomed by the Australian Retailers Association group Fair Imports Alliance.

"The Fair Imports Alliance also looks forward to some more constructive consultation regarding the customs compliance campaign, which should shed light on businesses and individuals misusing the current GST-free threshold for imported goods," Alliance spokesperson Russell Zimmerman said in a statement.

The Department of Broadband Communications and the Digital Economy is holding an online retail forum this Friday in Sydney. Communications Minister Stephen Conroy, Small Business Minister Nick Sherry and a number of retailers have been confirmed to speak at the event.

[*r3830*]

You know wheels..... I've read this article and also given it some thought. Thanks for posting it by the way - I didn't know it was going to raise its ugly head again. I'm considering a submission.... on the basis of the pure hypocrisy that this idea is.

It does raise some interesting questions as to how this will work - and who the beneficiaries of this "big new tax" will be.

I wonder......

Given that my items are small cost imports (and rather infrequent lately) - will our government collect this tax on behalf of the overseas seller? Will it remain here - or will it be returned to the government in the country of origin?

If it stays here.... wouldn't that be the same as imposing a tariff.... which, as I understand, would be a breech of the "Free Trade Agreement". Just this morning, Julia Gullible announced that NZ apples would be free to come into this country, flood our local markets and push our own producers further into the mire. No talk of protection tariffs for our people was there?

But then.... it must be a good idea - because Jerry Harvey and his hangeronners said so!

 

[*Brum6y*]

Customs tariffs and GST are two different animals.  They operate in different ways and are quite distinctly expressed in law - which is where any debate will ultimately end up referring to.  I would expect any free trade agreements to contain themselves within the scope of Customs duties.  From my understanding, GST won't come into it - at least not directly.

The fact that they both come onto the scene at the same time for imports is the only thing they have in common.

[*Brum6y*]

The thing that I am interested to see is - IF Jerry (**sorry) Gerry and his mates DO get their way and GST is levied on everything (for arguments sake) - what happens when the effect on imports takes a temporary dip in response, but then shoots up higher than before?

I think the retailers are going to rue the day - if they get their wish.

In the past, I feel that people would have been containing their spending to keep under the $1,000 limit, but if everything is going to cop the GST, then why not get $2,000 or $5,000 worth of stuff - it'll save a motza with combined shipping!

Afterwards, when the retailers are hurting MORE, who or what are they then going to blame?  Also, when the buying public are reminded that this was the 'Big Cause' that would 'Save the Retailers' only to find that paying 10% more for everything they imported did NOT achieve what was so passionately claimed, then Jerry (**sorry) Gerry and his mates are going to be crucified.

(** apologies to Jerry Seinfeld, who is actually funny)

[*Ubbie Max*]

Yep. If worst case scenario ends up applying, Gst of 10% on the value of the goods plus 10% Gst levied upon the postage cost plus any duty that is applicable will still equal, in many cases,  goods being purchased overseas that are still up to 50% cheaper than retail prices here & sometimes even cheaper.

Bring it on Gerry. I don't buy from any Harvey Norman store. I price shop there but, find most other retail outlets are cheaper anyway.

I used to know Gerry years ago when I played Rugby League. He would occasionally have a drink with us after the game. He was a good, down to earth bloke, I wonder what happened.

[Liisa-Sx]

Yep. If worst case scenario ends up applying, Gst of 10% on the value of the goods plus 10% Gst levied upon the postage cost plus any duty that is applicable will still equal, in many cases,  goods being purchased overseas that are still up to 50% cheaper than retail prices here & sometimes even cheaper.

Bring it on Gerry. I don't buy from any Harvey Norman store. I price shop there but, find most other retail outlets are cheaper anyway.

I used to know Gerry years ago when I played Rugby League. He would occasionally have a drink with us after the game. He was a good, down to earth bloke, I wonder what happened.

Gerry not Jerry lol, was out this way not too long ago (see carpark in penrith issue) and I had the opportunity among many others to speak directly with him, (I made a point to be there) in a Q and A session he was holding.  I asked aboout his GST/tax issue and his reply was something along the  lines of "every Australian should look to keeping funds within Australia to prop up the retail enconomy and that a Tax/levy on imports could only assist in maintaining retail outlets in australia", when I mentioned the fact that even if GST was added to overseas puchases that a greater majority would still shop overseas at a cheaper rate due to the seemingly exsessive prices paid in Australia he suddenly had other questions to answer.....I too used to thin gerry was a down to earth guy, quite frankly now I think he has his head up his A.....

[*smee*]

well based on that heres Gerry



lucky he isnt Taswegian ...how would you get them both up there ?