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Coalition to drop $1000 GST Threshold for Online Shopping

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Scotty

David Codey (61)
Don't worry about the retailers whining. Every time we buy something from overseas the government doesn't get its share of the GST it's lose lose. Less jobs in Australia and less revenue for the services we love. I can see why they need to do something.

I agree with Sully on this. Provided there is an efficient way to collect the revenue I don't see why all items that are purchased from within this country should not be subject to the same taxes.
 

Inside Shoulder

Nathan Sharpe (72)
I agree with Sully on this. Provided there is an efficient way to collect the revenue I don't see why all items that are purchased from within this country should not be subject to the same taxes.

A highly efficient way to do it would be to add 10% to the credit card charge at the bank (or the paypal account as it comes back to the Australian account on which it draws).
Bank remits it to government.
If the price for whatever reason included GST then the purchaser could make application to get it back.
 

fatprop

George Gregan (70)
Staff member
Do you have some details on this statement?
Nup, but I spent quite a lot of time working in business process consulting and direct marketing fulfilment

It looks to me that the compliance costs to collect $50 (on say a 500.00 purchase) will be well over the money collected
  1. You have the cost of opening each parcel, to confirm good cost, does it match the declaration
  2. The cost of repacking the parcel
  3. Then the cost of communicating with the purchaser
  4. The cost of processing the payment
  5. The cost of managing any objection
Sent from my Nexus 4 using Tapatalk
 

AngrySeahorse

Peter Sullivan (51)
Do you have some details on this statement?


"Lowering the threshold to $20 would raise in excess of $550 million in tax revenues, but the cost of the processing using the current system would escalate to over $2 billion — more than three times the additional revenue collected,” the Commission stated.

From the following http://www.smartcompany.com.au/fina...ustralia-stacks-up-compared-to-the-world.html

There are some other articles that state the costs around the same sort of figures. Its not really so much the GST itself that people are worried about but the processing fees. Will the government make changes to the system of processing the parcels so that it is more streamlined & cost effective or will they just keep the system & slug the buyer with all the costs in hope of driving all spending towards local business. It won't stop me from buying overseas as the stuff I get is not available here but the fact that I'll be hit with more costs (excluding the GST) simply because Australian retailers are bloody useless & don't stock the stuff I want seems rich to me.

I should of named this "overseas online shopping" as I believe this is on importing so local online should remain unaffected.
 

Braveheart81

Will Genia (78)
Staff member
A good point I saw elsewhere today is why doesn't the federal government target non physical goods bought online?

Australians buy around $1b worth of google ads every year and these are not subject to GST.

If the GST is a proper consumption tax where the domicile of the purchaser is what you are targetting then why shouldn't they collect GST on online transactions relating to software purchases, ad purchases etc?

They need to work out a way whereby the collection of the tax is efficient both in terms of the consumer being able to pay the tax and collect their goods and the net benefit to tax revenue being a considerable portion of the extra tax collected.

It will only harm the economy if it basically works like a tariff to protect domestic businesses and actually comes at a cost to tax revenue.
 

AngrySeahorse

Peter Sullivan (51)
Good point BH. I hadn't even thought of non-physical items online. People buy digital video games, movies, etc online. I personally prefer to have hard copies but I can see digital purchases becoming very popular.

A few articles have used the term 'tariff' to decribe what's being proposed.
 

fatprop

George Gregan (70)
Staff member
The funny thing for Gerry and his mates is that is that their basic assumption is wrong.

A 10% increase in overseas purchase cost would not change my buying habits, because it ain't all about the price (which is generally has a substantially greater saving than 10%), but also choice.
 

The Red Baron

Chilla Wilson (44)
Good point BH. I hadn't even thought of non-physical items online. People buy digital video games, movies, etc online. I personally prefer to have hard copies but I can see digital purchases becoming very popular.

A few articles have used the term 'tariff' to decribe what's being proposed.

This is true. I pay exchange rates on xbox live content and steam content, and the game clients are generally downloaded from servers in the US. It would be a nightmare to implement the gst system on those sort of purchases.
 
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