"GST Changes - overseas purchases" Topic

This was raised in 2013 on this forum but as of January 1st it comes into effect courtesy of our beloved government:

"Under changes announced in the 2015-16 budget, overseas businesses with an annual turnover of $75,000 USD are required to register with the Australian Taxation Office to collect GST (read VAT, Sales Tax etc.) on all goods sold, with purchases under the current low-value threshold of $1,000 USD included from 1 July 2017."

Now I am far from an account or lawyer but am I correct that anything we get from overseas now will be subject to GST after July 1, with no exempt threshold? Also, $75 USDK is not a huge amount of turnover (not profit) once the exchange rate kicks in, so does that mean most UK/US businesses will now have to collect GST for Malcolm and his mob in Canberra?

Really the only people who are going to make anything out of this is the government.

I'll still buy my stuff from U.K. Suppliers and still save money.

Too many Oz suppliers hike the price up too far, have priced up many orders from Oz stores and U.K. Stores, even with freight it still works out 30-50% cheaper.

There has been a big push by Oz retailers to get the 1000aud limit abolished as they think it'll force online shoppers to buy from Oz online stores, it won't as they are still too expensive.

For gaming goodies I only buy paint spray cans and a few paints from Oz sellers and maybe a couple of eBay purchases, all my rules, books, modeling gear, bases and figures come from the U.K.

I'd like to support Oz stores, but they've priced themselves out of my range.

Cheers Andy

The answer is yes but… the enforcement will be an interesting challenge… especially as it will require manual processing or changes to shopping carts to enable identification of OZ shoppers (well at least those not using VPNs)

This is aimed more at the likes of app stores and Amazons. I agree with all of the above but am more wary of online retailers outside of Australia charging us GST without actually registering, as a way to boost margins on Australian sales.

I suspect few if any American producers will comply with Australian tax laws.

Yeah, sadly, the locals rarely stock anything that I want and, if they do, I can nearly always get it cheaper from o/s. I buy some paints here, but very little else. I don't know whether the Aus retailers get charged exorbitant amounts by the o/s suppliers and have no choice but to pass the costs on to their customers or whether they just think that we all can't figure out how to order from o/s.

I'm not sure how the new GST rules will work, but I might be ordering a lot of stuff before they come in.

Similar measures introduced in the EU just resulted in numerous smaller businesses stopping selling over the Internet, either shutting up shop altogether or only selling in person at fairs and markets, avoiding taxes altogether.

It doesn't, and won't, affect the giants like Amazon other than to give them another advantage by clubbing the medium sized players out of the market. I forsee many online sellers just putting up a 'no order accepted from Australia' sign on their web sites as it will be uneconomic to comply.

As for the legality of the impost, I would love the US government to get involved as this will damage many smaller US businesses – I seem to remember something about 'No taxation without representation'.

It will of course give the local gougers a big boost – I already see 200-300% markups on top of what I can land goods for retail by companies claiming to be 'Distributors' or 'Exclusive Agents' who should be buying the goods for 50-70% of what I can buy them for.

I thought the changes to GST on imports did not kick in until the 1st of July. It will certainly diminish my purchasing power as I have only a very small gaming budget and Australian suppliers simply do not stock the stuff I am interested in.

TW

One good challenge by an overseas retailer, and bye-bye tax. Problem is, a retailer small enough to care probably won't be able to afford the legal cost.

The logic behind this is to protect local suppliers from overseas competition getting an unfair advantage by not charging tax. If you were a retailer how happy would you be if you had to compete with someone not forced to charge the same amount. Look at it this way, you are paying no more than you would if you could buy the same product locally.

One problem is people avoiding taxes everyone else pays – and the big corporations are guilty of that by siphoning profits to tax-free zones.

'As for the legality of the impost, I would love the US government to get involved as this will damage many smaller US businesses – I seem to remember something about 'No taxation without representation'. '

Should also be a rule 'no representation without taxation'.

In other, pay your dues, the money still has to be raised and if you don't pay your share someone else has to pay for you. Or you finish up paying more in other taxes anyway.

I don't understand how the Australian government can force off shore businesses to collect tax for them. I can under Australian customs collecting tax on anything imported because you can stop everything and check but how do you find out whether an off shore business a) collected the tax b) turned that money over to the government?

gfawcett…..they'll just start every overseas company a fine, with a pay in 28days or it's doubled letter! :-)

Cheers Andy

Apparently they want to block businesses from reaching oz customers online if they dont comply….sounds ludicrous and dictatorial methinks.

Many countries are doing this. It is due to the increase in internet shopping and as stated above, it is unfair to domestic businesses to have to deal with competition from people who provide the same goods and services but don't pay the same taxes. Complain all you like, but don't be surprised if you no longer have local stores because they cannot compete.

Vigilant, I have 7 stores within a 40min drive of me, these are where I buy spray and pots of paint, brushes and sometimes basing materials.

Only 1 of them sells Ancient figures, and doesn't really carry any stock of them, I always get the same answer when asking for stuff "I can get them for you, but it'll take 6 weeks", his prices are usually 50% more than other Oz stockists charge, so about 100% more than U.K. Sellers and that's still before freight is added.
The guy who runs the shop has a full time job and this is just a hobby for him, but a bloody well paid hobby eh?
I would be no worse off if all the stores here closed down, hence why I'll still buy my gear from U.K., and luckily for me, I have relatives over there, so if Gov gets too greedy, I'll just get my family to get the stuff I want and send me a nice big parcel and pay them the total!

Have a great New year :-)

Cheers Andy

Yep, rather than embrace the internet, we are turning back to the 70's purchasing systems

I live in Darwin, no shops here…..

I think some may misinterpreted my comments that taxes shouldn't be collected I just think that government's customs organizations should be the enforcers not the off shore companies.

Customs wasn't going to make it more expensive, the customs office idea was floated so we had to go through a lot of legal red tape and paperwork to get the stuff we ordered. The tax system has to be redesigned such that the tax could be applied by the purchaser at checkout and then collected as it goes through the post office/SAL/TNT/etc.
gfawcett:
Customs would still get the item, and there would be a paper trail for it, and they would find out.