While there is plenty for photo retailing businesses to be upbeat about in the 2015 Federal Budget, moves to ditch the GST-free status of imports under $1000 seems further away than ever.
With the GST on imported intangibles not kicking in until July 2017, it seems unlikely that the advantage handed to foreign online retailers is going to be taken back any sooner than that.
‘While this [the ‘Netflix tax’] is certainly a positive step, we must now ensure GST collection is extended to low value parcels,’ said Russell Zimmerman, executive director of the ARA.
‘It should be just as easy to collect GST from Amazon as it is to collect GST from Netflix and Apple, meaning there is little excuse for the Federal and State Governments not to move on collecting all GST on products under $1000 from overseas.
‘State Governments are losing billions of dollars in GST revenue which could support teachers and emergency services in our communities,’ he said. ‘Australian retailers are also suffering from an uneven playing field, and this is costing many local jobs.
‘The ARA has been leading the campaign to fix the under $1000 GST loophole for goods bought from overseas and is concerned that tonight’s budget did not offer any specific remedy to this issue. We do, however, commend Assistant Treasurer Josh Frydenberg on his leading position and commitment to solving this issue once and for all.’
‘It seems the Government has learned from the last year and this budget recognises how the digital economy has changed the business landscape in Australia. What we need to see now is every effort made to strengthen our tax system as well as build consumer confidence with a clear long term plan from Government to support consumers and businesses alike,’ Mr Zimmerman said.
An opinion piece on the 2014 Budget from John Swainston, also gives the Federal Government a ‘Fail’ in being unwilling to move on this critical imbalance between local and offshore retailers.
‘The government has flunked the necessary closing of the GST loophole because it sees this as an unpopular move with electors,’ he concluded.