Forums > General Discussion   Shooting the breeze...

GST on low value imported goods

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Created by FormulaNova 3 months ago, 6 Jun 2018
FormulaNova
NSW, 7278 posts
6 Jun 2018 8:49PM
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I think the GST on imported goods is coming in very soon.

Does anyone know how this is going to work with ebay? Does ebay end up charging the GST on everything that needs to come in from overseas, or does the government send you a bill for each item that comes in through the post?

Chris6791
WA, 3069 posts
6 Jun 2018 8:44PM
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I think they're expecting EBay etc to do the tax collecting.

Some light reading.

www.ato.gov.au/General/New-legislation/In-detail/Indirect-taxes/GST/GST-on-low-value-imported-goods/

gs12
WA, 214 posts
6 Jun 2018 9:04PM
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Chris6791 said..
I think they're expecting EBay etc to do the tax collecting.


Correct. That's why amazon.com will be blocking aus customers. I think they feel it adds too much effort for them to collect gst for Australian tax office to make it worth it for them.

AUS1111
WA, 3043 posts
6 Jun 2018 9:31PM
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This is the kind of stupidity that populist politics brings us. The tax costs more to collect than it brings in revenue.

FormulaNova
NSW, 7278 posts
7 Jun 2018 7:15AM
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AUS1111 said..
This is the kind of stupidity that populist politics brings us. The tax costs more to collect than it brings in revenue.


Yeah, I dunno. I can see that it MAY cost more than it brings in, but its a bit unfair for retailers here that have to pay GST when someone buying directly doesn't. If they can make it efficient, surely it brings in more money to the tax system that can be used to fund everything else.

I tend to buy a few small things here and there from ebay, so the 10% from those is not much, but it adds up if you talk about 40 million items just like this that are coming into the country each year.

If ebay themselves do the tax collection, then it should be efficient, and they can just send the ATO a bunch of data that shows where it all came from, as well as the money.

On the other hand if its where each item coming into the country then generates an invoice to the consumer, then I agree and it surely costs more than its worth, although like any government they are sure to charge you enough to cover their costs and the tax on top. Hopefully they do it through the likes of ebay though as it makes much more sense.

Oh well, its coming soon, so no doubt we will see it. If I start seeing invoices turn up then I guess I have to start buying from local suppliers.

Paddles B'mere
QLD, 1599 posts
7 Jun 2018 8:35AM
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I absolutely agree with you FN, our retailers are being effectively penalised on price by 10% for final consumer goods, this should have been cleared up years ago.

For those that believe it is difficult to collect, we aren't in the dark ages any more and the tax man doesn't show up in a horse and cart with a knight on horseback. These companies like ebay have advanced e-commerce systems that could easily figure out where a buyer is located, internally calculate 10% of the purchase price if it is from an overseas business seller, backcharge it to the seller on top of the sales fees and then remit the amount to the ATO on a cycle. The reason they don't want to do it is more about a protest about being told what to do than the cost to implement the software change I reckon.

Mobydisc
NSW, 8140 posts
7 Jun 2018 9:31AM
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Rather than increasing the range of the GST on imported stuff, it would be better to remove GST from stuff sold in shops.

Paddles B'mere
QLD, 1599 posts
7 Jun 2018 9:36AM
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Righto, well I've got a different angle. I reckon a GST is an awesome tax (as opposed to just straight income tax) because more people pay it, but I accept that people have different views regarding a VAT.

novetti
WA, 222 posts
7 Jun 2018 8:10AM
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The cry poor of local retailers worked...and you know what?
Won't change jack shai t e to them because even paying 10% they are still more expensive to 95% of the crap I buy online.

Instead of lobbying the goverment to really fix the problem and level the playing field to them (how much a local business operating taxes and costs are in comparison to someone overseas?). That is the real problem. Land taxes, rates, company tax, etc etc + a Fat profit markup.

Fat and lazy local retailers sprung and hijacked the australian customer for too long.

An example:
I am buying a susbtantial piece of equipment next month from Overseas, even if this GST thing was 30% will still be cheaper for me to import directly from China (plus LCL shipping costs!) than buy from the middlemen australian business.

This is just revenue grabbing, nothing to do with equalizing things for australian retailers.

Paddles B'mere
QLD, 1599 posts
7 Jun 2018 11:33AM
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You're right Novetti, it is a revenue grab, but it's also an equalizer for local retailers. If they can't compete with the market when the tax playing field is leveled then they've simply gotta find some other way to make a living.

mineral1
WA, 4416 posts
7 Jun 2018 9:43AM
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Just the old Harvey Norman tax. Cost more to implement and activate.

Bara
WA, 365 posts
7 Jun 2018 9:45AM
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Paddles B'mere said..
You're right Novetti, it is a revenue grab, but it's also an equalizer for local retailers. If they can't compete with the market when the tax playing field is leveled then they've simply gotta find some other way to make a living.


yeah they could open another cafe i guess. OS suppliers cant compete with that one...

bought my new wetsuit from UK - delivered in 3 days and $180 cheaper than local shop who didnt even have my size

bought some boardies from quicksilver over east and 2 weeks later still in the post.

actually paying the 10% gst take wont cause much of a hiccup.

stick to the coffees aussie retailers (not your fault its the rent and wages but thats how it is)

Chris6791
WA, 3069 posts
7 Jun 2018 10:06AM
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If they slap the GST on imported online purchases what will the un-competitive retailers out there whinge about next?

10% on a product already 50% cheaper won't really change our online habits anyway.

novetti
WA, 222 posts
7 Jun 2018 10:09AM
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Price of coffee in Perth - 3.5 AUD (but you get to check the inked arms or pierced face of your favorite barista M or F while waiting).
Price of coffee in Spain or France 80 cents to 1 Euro (happy not to check anything).

I am the advocate while I still have a mortgage to pay (because of ridiculous real estate costs) I don't buy a single cup of coffee on the streets here.

This online GST thing will be complicated or impossible to enforce when you buy something directly (no ebay) from a small retailer OS that doesn't detail with Australians very often.

ONLY if they hold the delivery and charge you when you go retrieve it but lets not give them ideas.

Chris6791
WA, 3069 posts
7 Jun 2018 10:25AM
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The would have done their computer modelling, if they can pick off the top 20 foreign retailers sending goods to Australia they'll probably capture 95% of the GST revenue anyway.

gwunder
NSW, 8 posts
7 Jun 2018 12:47PM
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Just remember if you buy online you may end up eventually with no local shops.
Some might say who cares...but where are you going to try gear on for size??
Shops are also getting better at identifying 'show-rooming' (where a person uses the shop to try on before they buy online). Smart shops (if possible) don't stock brands sold online.

Agree pricing is not great locally but surely its better to support local if the product is withing reason on pricing??

Chris6791
WA, 3069 posts
7 Jun 2018 11:28AM
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It's changing marketplace, retailers need to suck it up, evolve and find a business model that works. If they don't they go bust; it can't be any simpler. It's harsh but it's also the reality. There's plenty of Australian online retailers that are extremely successful, many still with traditional bricks and mortar stores complementing their online presence.

Adding the 10% GST will level things out a little but it's not the only issue for retailers in Australia. I think the Myers and David Jones are still going to struggle, they seem to be too big and too slow to adapt to the changing market.

Not being able to try stuff on isn't an argument for keeping traditional stores when the big online clothing retailers make it pretty easy to exchange/refund via return post anyway. One big online Australian retailer I've used a few times used to give a 5% online credit on exchanges.

novetti
WA, 222 posts
7 Jun 2018 11:36AM
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gwunder said..
Just remember if you buy online you may end up eventually with no local shops.
Some might say who cares...but where are you going to try gear on for size??
Shops are also getting better at identifying 'show-rooming' (where a person uses the shop to try on before they buy online). Smart shops (if possible) don't stock brands sold online.

Agree pricing is not great locally but surely its better to support local if the product is withing reason on pricing??


I am on this topic today because this whole problem is a reflection of why we are selling ourselves hollow. Australia is expensive and uncompetitive to retail or manufacture anyting.

Landlords of business retail spaces won't be so proud of their portfolios when they won't have tenants to rent from them anymore?
Seriously if not for selling coffee at ridiculously inflated prices, why would you bother doing anything?

Utilities companies jacking up their prices at every calendar year way above CPI inflation?
Same for the councils (fat, bloating with leaches and their perks). My rates are going up by 13% this year (and is been going up 3x times above CPI for the last 10 years).
Vehicle registration pretty much doubled in 8 years.
The only thing not going up is your salary, or the wages for the paltry workforce providing in most cases limited and poor customer support at these facilities.

Add that to limited choice, outdated products, a joke of customer support, limited retails hours, etc.

GST on low valued imports is just a money grab pure and simple.
Won't do anything to assist small and mid sized retailers to face the trade war they have up coming, when the start go conditions set by the Federal and Local governments already tie them down blindfolded without any chance to compete.



GreenPat
QLD, 3968 posts
7 Jun 2018 1:39PM
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novetti said..

Instead of lobbying the goverment to really fix the problem and level the playing field to them (how much a local business operating taxes and costs are in comparison to someone overseas?). That is the real problem. Land taxes, rates, company tax, etc etc + a Fat profit markup.

Fat and lazy local retailers sprung and hijacked the australian customer for too long.


"Land taxes, rates, company tax, etc etc + a Fat profit markup."

I reckon those four things would be peanuts compared to rent/property cost and wages. The cost of living in Australia means high wages compared to other countries that can retail goods for less...

Paddles B'mere
QLD, 1599 posts
7 Jun 2018 2:06PM
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Hey Novetti, the "market" is the equaliser. It's simple, if a business can't compete then it goes out of business and the people working there have to find something else to do that they can be competitive at.

Things over in the west may be exaggerated a bit because of FIFO dollars flowing from the north. It used to be the same over here, I mean how can you get someone to work for $25/h at KFC or City Beach when they can double that working at the mine or the processing facility? You just pay more and charge more for a pair of boardies that's how. The "market" refers to everything, labour costs included. Things have softened somewhat over here now.

Again, the reason I like GST is because it doesn't discriminate, if you buy a good or service that is eligible for it then you pay tax. If the government can get more cash by expanding it then great, hopefully they won't be so quick to put up other taxes.

bazz61
QLD, 1538 posts
7 Jun 2018 2:30PM
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So you like your hard earned $$ taxed twice ...!?really ... gst easily avoided by lumping personal costs in with business costs .. ie using business vechile to drop kids at school or tow boat ... a financial transaction tax is more fair , everyone pays & no paper work for business , who enjoys being an unpaid tax collector for the government ..?

Paddles B'mere
QLD, 1599 posts
7 Jun 2018 2:34PM
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What transactions get taxed with a transaction tax bazz?

bazz61
QLD, 1538 posts
7 Jun 2018 2:47PM
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Anything you want from house purchase to share purchases , the banks collect it .. bankers hate the idea . The overall rate would be lower than the present gst , some countries have it in place now . The present gst system is fuc...d , No one likes doing bas statments , its time consuming & a drag on small business ... & export business claim every cent payed back .

Paddles B'mere
QLD, 1599 posts
7 Jun 2018 3:23PM
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Trouble is we have a $50b (according to the ATO) cash economy that the ATO are trying real hard to reel in and no bank transactions happen in this economy.

Right now, the people who deal in cash (with no banks being involved) will eventually have to buy stuff off legitimate businesses that report the transaction (packet of smokes, bottle of bourbon, box of coco pops etc) and tax is paid when they do this. If a transaction tax is implemented and sales tax and GST is removed, these guys will pay no tax at all. So I guess I'm suss on the efficiency of a transaction tax.

A transaction tax on money leaving Australia however, that's what we need! No more tax free "consultancy fees" to the Singapore office

Gizmo
SA, 2834 posts
7 Jun 2018 5:17PM
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Thumbs up for a transaction tax from me.....Every time $$$$ are moved into / within / or out of a financial institution it should be taxed.....It would also catch a lot of those big businesses that seem to avoid paying tax......
And if the $$$$ leave the country DOUBLE the tax.
Also how about taxing churches and other exempt corporations like large sporting groups..... The AFL for example pays NO tax as they claim they do community work.

Mobydisc
NSW, 8140 posts
7 Jun 2018 6:15PM
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Gizmo said..
Thumbs up for a transaction tax from me.....Every time $$$$ are moved into / within / or out of a financial institution it should be taxed.....It would also catch a lot of those big businesses that seem to avoid paying tax......
And if the $$$$ leave the country DOUBLE the tax.
Also how about taxing churches and other exempt corporations like large sporting groups..... The AFL for example pays NO tax as they claim they do community work.




I'd rather decrease the numbers of people paying tax and at the same time reduce the taxpayer subsidies going to organisations like sporting clubs & other civil society organisations. If people think it's important to have them they could support them out of their own pocket.

Raising the income tax free threshold would be a great way to help the lowest paid people to keep more of their own money in their own pocket. Decrease the gst as well. Without all the bludgers who could support themselves if they had to instead of sponging off the State, it would be affordable for the State.

Australia is a country where poor people are taxed to pay for the hobbies of rich people.

FormulaNova
NSW, 7278 posts
7 Jun 2018 7:30PM
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Mobydisc said..

I'd rather decrease the numbers of people paying tax and at the same time reduce the taxpayer subsidies going to organisations like sporting clubs & other civil society organisations. If people think it's important to have them they could support them out of their own pocket.

Raising the income tax free threshold would be a great way to help the lowest paid people to keep more of their own money in their own pocket. Decrease the gst as well. Without all the bludgers who could support themselves if they had to instead of sponging off the State, it would be affordable for the State.

Australia is a country where poor people are taxed to pay for the hobbies of rich people.


One of the reasons each government was tripping over itself to implement a GST, even whilst saying it was bad when they weren't in power, is that it catches a lot of cash transactions in some way. The aim is/was to reduce the direct tax burden on everyone else.

I think its a great idea. You earn a lot of money from cash transactions? Well, you are going to pay tax somewhere along the way, whereas before the government wouldn't see a cent of it.

Decreasing tax for lots of people sounds like a great idea, unless you are the group that has to fund all the things that a community requires.

I can't imagine a world where anything not necessary is not funded because we expect the users to pay.

Get into trouble windsurfing and need rescuing? Bad luck, you should have gotten insurance.

Have a child that needs a life saving operation. Bad luck, you should have saved up to pay for it.

Mobydisc
NSW, 8140 posts
7 Jun 2018 7:43PM
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FormulaNova said..

Mobydisc said..

I'd rather decrease the numbers of people paying tax and at the same time reduce the taxpayer subsidies going to organisations like sporting clubs & other civil society organisations. If people think it's important to have them they could support them out of their own pocket.

Raising the income tax free threshold would be a great way to help the lowest paid people to keep more of their own money in their own pocket. Decrease the gst as well. Without all the bludgers who could support themselves if they had to instead of sponging off the State, it would be affordable for the State.

Australia is a country where poor people are taxed to pay for the hobbies of rich people.



One of the reasons each government was tripping over itself to implement a GST, even whilst saying it was bad when they weren't in power, is that it catches a lot of cash transactions in some way. The aim is/was to reduce the direct tax burden on everyone else.

I think its a great idea. You earn a lot of money from cash transactions? Well, you are going to pay tax somewhere along the way, whereas before the government wouldn't see a cent of it.

Decreasing tax for lots of people sounds like a great idea, unless you are the group that has to fund all the things that a community requires.

I can't imagine a world where anything not necessary is not funded because we expect the users to pay.

Get into trouble windsurfing and need rescuing? Bad luck, you should have gotten insurance.

Have a child that needs a life saving operation. Bad luck, you should have saved up to pay for it.


If taxes paid to save those who can't save themselves then I'd be alright with that. However taxes seem to spent on almost everything but that. Taxes are generally spent on those who think society owes them a living. Not all of them are on the dole or pension. Many of these people wear a costume with badges on them. Many wear a suit. Usually they have a few letters after their name.

jn1
SA, 1557 posts
7 Jun 2018 7:23PM
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Absolute dumb f*ks. I don't mind the tax, but has the govt thought about the chaos it will cause ?, not only for low $$ goods, but ALL imported goods ?. How many warehouses will customs have to build to support this control as they go from holding pallets to letters ?. How much of this stuff will get lost, damaged as a result of another link in the logistics chain ?. Will customs hold my goods and send me a letter requesting payment ?. The govt is renowned for not thinking things through. This is as silly as when AFP requested ISPs provide 2 years worth of traffic logs/data in the early 2000s, expecting small businesses like the one I worked for to implement all what they wanted with no funding or resource support. Why can't we declare imported GST it as apart of our income tax ?. The same audit process and penalties apply to people falsifying this info. I think that would be a smart why of going about it.

AUS1111
WA, 3043 posts
7 Jun 2018 8:01PM
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They shoulda put a tax on tractors to save the horse and cart industry

Chris6791
WA, 3069 posts
7 Jun 2018 9:06PM
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jn1 said..
Absolute dumb f*ks. I don't mind the tax, but has the govt thought about the chaos it will cause ?, not only for low $$ goods, but ALL imported goods ?. How many warehouses will customs have to build to support this control as they go from holding pallets to letters ?. How much of this stuff will get lost, damaged as a result of another link in the logistics chain ?. Will customs hold my goods and send me a letter requesting payment ?. The govt is renowned for not thinking things through. This is as silly as when AFP requested ISPs provide 2 years worth of traffic logs/data in the early 2000s, expecting small businesses like the one I worked for to implement all what they wanted with no funding or resource support. Why can't we declare imported GST it as apart of our income tax ?. The same audit process and penalties apply to people falsifying this info. I think that would be a smart why of going about it.


There's no interruption to the supply chain for low value goods. Online retailers will presumably jack up the price for Aussies, collect the 10% tax at the time you click 'agree to purchase' and forward it onto the govt.

What would be interesting to see is how the ATO manage and monitor it all without crashing online shopping and also stop overseas retailers charging us the tax and not surrendering it to the ATO.

Goods over $1000 will still be handled the same way as in the past. Don't the shipping companies warehouse the goods until the tax and handling fees are paid? They slugged me a fortune last year when I forgot about the $1000 limit and forgot to split an order.



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"GST on low value imported goods" started by FormulaNova