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Thread: GST on purchases under $1000

  1. #1
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    GST on purchases under $1000

    Well folks,....
    It's coming on 1st July this year unless it gets knocked back in Parliament. This means that you will be paying more not only for your vaping supplies but anyything else that you purchase (not only online) from overseas.

    Imported goods under $1000 to face GST

    Ahaaaa, you must be thinking that I'm only whinging about paying extra ...... you are wrong, so read on.

    I received a newsletter email from my local member with a short blurb about how good it will be, here is a short extract from the blurb:

    "The legislation requires overseas vendors, electronic distribution platforms and goods forwarders many of which are multinationals with an Australian turnover of $75,000 or more to register for, collect and remit GST for low-value goods supplied to consumers in Australia."

    From this one paragraph alone, I can see that this legislation has not been researched, planned, constructed or presented correctly. Let alone properly thought through to examine all ramifications. To begin with it can be read two ways.

    1. That if the OS vendor has business dealings (in total) of $75k or above in Australia, then they must comply.
    2. That if the OS vendor has an annual business turnover (AU equivalent) of $75K or above and want to do business in Australia, then they must comply.

    So either way if an OS business wants to do business here in AU, essentially they must submit (or make known) their business dealings, then as it says (dependant on the $75K), they must register for, collect and remit this tax to the Australian Government. Personally I think that because English is a second language (and a very scratchy one at that) a lot of the places we shop will simply put it in the too hard basket and refuse to ship to Australia, effectively restricting our buying market. Or if they are half smart they will BS about turnover thereby inviting scrutiny (presuming that customs monitors everything), which will introduce the risk of you losing your purchased item through confiscation or perhaps coughing up the gst on collection.

    So that takes care of the average consumer, who will be paying through the nose even more, now that OS competition will possibly be restricted. If you have the market, you can charge virtually what you want.

    Now just think about the impact on micro businesses here in AU that import materials or product for manufacture or resale. If the legislation gets passed and the OS vendors don't want to play ball, how many of those micro businesses (whether vaping or other sectors of the economy) will stay in the same business ? Once again, a lot of our micro business source materials or product from non English speaking countries. I predict that hundreds if not thousands of home based micro businesses will be affected or go out of business. This will be a huge impact on the economy.

    I know there is the idiom that if OS vendors want our business they will comply, however, apart from the multi-nationals, high end goods and mainstream consumables/commodities, Australia is not a big enough marketplace comapred to the rest of the world to warrant too much extra time involvement or hassle in making a sale. Our population is only about 24 million. We should be making it easier for Australians to do business OS (not harder) and doing the paperwork in AU.

    To finish up, if the politicians want this extra tax I doubt there's anything we can do about it, however what I would ask you to do is write to your local MP about changing the method of tax collection from the OS vendor to the point of delivery which would be the local Post Office or International Courier (value of the item is on the customs declaration anyway which is filled in by the OS vendor upon shipment). I've already started with my local Member, and if I don't hear back then I'll start pestering the opposition.

    Everyone only see's the extra $ they will be paying for an OS purchase, I foresee us losing the OS market is it's too much hassle to sell to an Australian !!!

    Thanks for reading, just my view as a layman. Maybe there is someone out there with more knowledge on this issue that can shed more light on the subject.

    Cheers
    Sodd
    1ynne, Danny76 and Cat like this.

  2. #2
    Cat
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    I have been waiting for this, and am surprised it has taken so long. I have been waiting for it since the introduction of things like EvilBay in fact. (I used to work in ATO...scarred me for life).

    Thank you for bringing it up, and for thinking it through to find viable alternatives and suggesting action to take.
    The Sodd likes this.
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  3. #3
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    Imagine the impact on nicotine sales into Australia, companies like HiLiq ect having to declare what is in the parcel for tax purposes, perfect way for the government to enforce a nicotine ban.
    The Sodd likes this.

  4. #4
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    Quote Originally Posted by The Sodd View Post

    To finish up, if the politicians want this extra tax I doubt there's anything we can do about it, however what I would ask you to do is write to your local MP about changing the method of tax collection from the OS vendor to the point of delivery which would be the local Post Office or International Courier (value of the item is on the customs declaration anyway which is filled in by the OS vendor upon shipment). I've already started with my local Member, and if I don't hear back then I'll start pestering the opposition.

    Everyone only see's the extra $ they will be paying for an OS purchase, I foresee us losing the OS market is it's too much hassle to sell to an Australian !!!

    Thanks for reading, just my view as a layman. Maybe there is someone out there with more knowledge on this issue that can shed more light on the subject.

    Cheers
    Sodd
    This will never happen because it will cost more to collect it than they get which was the whole reason for the $1k threshold anyway. Much easier to put the collection costs onto sellers even if it makes them not sell here
    Last edited by captive; 02-03-17 at 11:39 AM.
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  5. #5
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    Quote Originally Posted by captive View Post
    This will never happen because it will cost more to collect it than they get which was the whole reason for the $1k threshold anyway. Much easier to put the collection costs onto sellers even if it makes them not sell here
    it wouldn't surprise me if they did do it. they have a bad reputation of creating laws that we are told will be to get more revenue only for us all to find out down the track, once the data starts to mount up, that it's actually costing us money and sending us backwards. this government and countless before them are so anti-intellectual that it's baffling
    The Sodd and Cat like this.
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  6. #6
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    Quote Originally Posted by vape-oreon View Post
    it wouldn't surprise me if they did do it. they have a bad reputation of creating laws that we are told will be to get more revenue only for us all to find out down the track, once the data starts to mount up, that it's actually costing us money and sending us backwards. this government and countless before them are so anti-intellectual that it's baffling
    I dont doubt they will be collecting the GST just not from point of delivery
    Can you imagine the costs of local delivery people collecting gst from every stop? Or the lines at the post office while they process each package from overseas?

  7. #7
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    The reason that GST is not charged on imports less than $1000 is that the cost is not worth it. It would cost them more to administer it than they would gain in revenue. They'd have to throw more resources at it than they currently do for large scale imports and they still wouldn't be able to do it properly. Have a look at a lot of other countries that do this - it causes delays in OS mail of weeks or months because it's not economically feasible. I buy a $40 mod from Fasttech, how are they going to make collecting $4 worth of GST remotely equitable?

    So some bright spark came up with the idea of the overseas company collecting GST. What a completely stupid idea. Not only does the ATO have zero jurisdiction in other countries, expecting all OS companies to comply is an utter pipe dream. It's not going to happen. You are right - if it becomes an issue they'll just stop selling into Australia rather than do the ATOs work for them.

    The bill is only a draft. I think there's a good chance common sense will prevail on this one. Seems like Scott Morrison just felt he had to justify his facile existence.
    Chris: Tobacco free since 17:00 15th March 2013.

  8. #8
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    Quote Originally Posted by fabricator4 View Post
    The reason that GST is not charged on imports less than $1000 is that the cost is not worth it. It would cost them more to administer it than they would gain in revenue. They'd have to throw more resources at it than they currently do for large scale imports and they still wouldn't be able to do it properly. Have a look at a lot of other countries that do this - it causes delays in OS mail of weeks or months because it's not economically feasible. I buy a $40 mod from Fasttech, how are they going to make collecting $4 worth of GST remotely equitable?

    So some bright spark came up with the idea of the overseas company collecting GST. What a completely stupid idea. Not only does the ATO have zero jurisdiction in other countries, expecting all OS companies to comply is an utter pipe dream. It's not going to happen. You are right - if it becomes an issue they'll just stop selling into Australia rather than do the ATOs work for them.

    The bill is only a draft. I think there's a good chance common sense will prevail on this one. Seems like Scott Morrison just felt he had to justify his facile existence.
    How can anyone use the phrase "COMMON SENSE" when talking about our government no matter who is in power?

  9. #9
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    And the government care about a loss when they are appeasing Australian retailers that donate to political parties.
    1ynne likes this.

  10. #10
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    I am having a deja vue moment. I completed a Shopmate survey yesterday about this very thing ..... asking if I would still purchase if GST was applied to my purchases.
    The Sodd and AllyP like this.
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    Started Vaping 13th October, 2011

 

 
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