It is frustrating to report that the Federal Government has postponed the abolition of the Low Value GST Threshold on Imports until at least July 1, 2018. Apparently, the government has been under pressure from the major internet sellers, who, together with the bureaucracy, claim to have had not enough time to adopt the procedures necessary for collect GST at the border on all overseas purchasers.
The Association will continue to make representations to the government in an attempt to ensure that the abolition of this unfair tax on our industry is implemented by the now projected date of July 1, 2018.
The AFR reported that Retailers hoping for a boost in 2018 from the reduction in the GST-free threshold on goods bought online from overseas will have to wait another year.
The Government has postponed reducing the low-value threshold on imported online purchases for 12 months, until July 1, 2018, after e-commerce giants eBay, Alibaba and Amazon warned that the proposed regime was impossible to implement by July 1 this year.
Citi said the government expected the new regime to raise $70 million in the first year, suggesting that it would only relate to roughly $700 million or less than one-third of total spending through offshore online retail channels.
“The government’s estimates indicate expected challenges in collecting the GST,” Mr Woolford said.
Citi believes that only 20 per cent to 33 per cent of offshore online spending will eventually flow back to Australian retailers, which would lift discretionary retail sales by between $140 million and $2331 million or 0.1 per cent to 0.2 per cent.