10% GST on Online Goods under the $1,000 threshold after 30/6/2018
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Thread: 10% GST on Online Goods under the $1,000 threshold after 30/6/2018

  1. #1
    Fellow Frogger! Greg's Avatar
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    Default 10% GST on Online Goods under the $1,000 threshold after 30/6/2018

    Hi Fellow Froggers,

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    Today must be a day for me posting Doom & Gloom posts?

    The Australia Federal Government is going to attempt to tax goods purchased online with the GST after the 30th June 2018 that are under the $1,000 tax free threshold.

    My understanding is that the (international) seller is responsible for registering with the Australian Tax Office (if the retailer sells in excess of $75,000 in good to Australia in one year), and collects 10% GST on the goods and freight, and sends it off to the Australian Tax Office.

    Now I can understand big companies like Ebay etc, complying with those requirements, but what about companies like Der Franzose who would supply in excess of $75,000 of Citroen parts to Australia. Are they going to want to be a tax collector on behalf of the ATO?

    I think not, so what will happen is DF will say we will no longer sell Citroen parts to Australia.

    The ATO doesn't say anything about what happens with retailers who sell under the $75,000 threshold?

    This new legislation could have a massive impact on not only Classic Citroen parts importation, but the whole classic car community, and that only the beginning?

    Tell me if I've got it wrong, but unless you can find a supplier that sell the parts you need on sites like EBay, where EBay adds the GST and collects it somehow, and returns it to the ATO, there will be literally hundreds of thousands of sites that will just say Sayonara Australia, the sales to you aren't with it.

    A good case example is Der Franzose will not sell to the USA now because of liability complications?

    Any input you have into this new legislation is much needed, and there may well be some lobbying needed to show the government their stupidity in this instance.

    What are your thoughts?

    best regards,

    Greg
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    Fellow Frogger! garyk's Avatar
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    I often wonder whether pollies and bureaucrats actually live "in the real world."

    One useless scenario is where products are sold for a few bucks (I often buy these on eBay) ....
    how much paperwork, remittance, and admin costs will accrue to stay, a $2.50 cable?

    Yes, some suppliers will drop out of the market.

    Making many items much more expensive for Oz buyers = more pressure on households.

    Ia also wonder "who is the friend/force behind the ruling?"

    (Some suggest that Gerry Harvey really doesn't need to be any richer.....)

    I understand "competitiveness" but as Greg kinda alludes to ... who exactly in Australia is "the local competition" we need to support now that no cars are made here = virtually all parts must come from overseas.
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    Fellow Frogger! dimistyle's Avatar
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    Would be time to directly to the supplier rather than ebay if this is the case. A lot of the snaller parts supplies would be under the $75k limit.

    Or ship to a friend/ family in Europe and pay the postage again...hmmm 10% gst or 2 x postage. Not happy either way..

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    1000+ Posts Kim Luck's Avatar
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    I think you'll find that the $75K limit applies only to Australian businesses. You pay GST on a $5 item at Bunnings, why shouldn't you pay GST on a $999.99 item bought from overseas? Australian Customs need to earn their keep!
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    1000+ Posts robmac's Avatar
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    Quote Originally Posted by Kim Luck View Post
    I think you'll find that the $75K limit applies only to Australian businesses. You pay GST on a $5 item at Bunnings, why shouldn't you pay GST on a $999.99 item bought from overseas? Australian Customs need to earn their keep!
    Which brings up the point. The final seller of the goods is responsible for collecting GST on behalf of the ATO.

    Is the person holding the goods for sale or Ebay the final seller ?

    For The ATO ebay is better option, because of centralized money collection scenario. And paying in one big fat "cheque".

    We still need to see an ATO determination on the question. before we know how GST collection will work in practice.
    Mutual Respect is Contagious


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    eBay have already pointed out that they are not a seller, and won't collect or remit. Alibaba, Amazon and others have also said likewise.

    That leaves two options - either Australians will be blocked from overseas online sales, or the government will have to set up a collection agency here, similar to customs. The returns on effort for 10% on small parcels will not be of any benefit to the treasury.

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    1000+ Posts robmac's Avatar
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    Quote Originally Posted by seasink View Post
    eBay have already pointed out that they are not a seller, and won't pay. Alibaba, Amazon and others have also said likewise.

    That leaves two options - either Australians will be blocked from overseas online sales, or the government will have to set up a collection agency here, similar to customs. The returns on effort for 10% on small parcels will not be of any benefit to the treasury.
    What "they" have said, probably won't influence the ATO's determination.

    Ebay et al are at cross purposes with the ATO. And the ATO has the final say.

    I've yet see anyone sacrifice their income stream willingly.
    Mutual Respect is Contagious


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    We are talking about overseas sales, No? In that case a foreign seller can ignore the ATO. That includes eBay outside Australia (who aren't a seller anyway). If the ATO wants the money they will have to collect it here, presumably from the purchaser before delivery, like customs duty. The rate of tax is low, so handling fees in some shape will probably be added on.

    Goodbye any online advantage.

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    1000+ Posts robmac's Avatar
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    You have made a strong case to make ebay collect the GST, as I alluded to earlier.

    At the moment we are talking hypotheticals. To talk meaningfully we need the ATO to make a determination.
    Mutual Respect is Contagious


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    Default Hmmm !!!

    Quote Originally Posted by garyk View Post
    I often wonder whether pollies and bureaucrats actually live "in the real world."
    One useless scenario is where products are sold for a few bucks (I often buy these on eBay) ....
    how much paperwork, remittance, and admin costs will accrue to stay, a $2.50 cable?
    Yes, some suppliers will drop out of the market.
    Making many items much more expensive for Oz buyers = more pressure on households.
    I also wonder "who is the friend/force behind the ruling?"
    (Some suggest that Gerry Harvey really doesn't need to be any richer.....)
    I understand "competitiveness" but as Greg kinda alludes to ... who exactly in Australia is "the local competition" we need to support now that no cars are made here = virtually all parts must come from overseas.
    Hi
    Can we assume these are just rhetorical questions
    Seems to me that the difficulties are much wider than car parts (but this is a car forum ?) But It is hard to see how shooting yourself in the foot, by the compliance costs, will help the bottom line, eg making more tax money. SOOOOO the obvious answer it is just a mechanism to discourage people buying on line !!. Who will benefit from this is the question !! The Lib's mates

    Again seeing as they have reduced the Tax Office worker's numbers in recent years, to get a productive bonus (?), I fail to see how they can make it work. Corporate tax is several orders of magnitude bigger so where is the priority here.
    Jaahn

  11. #11
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    You will probably all have to line up at the post office once again.

    It would be very much smarter to collect it via the payments system and capture cards, Paypal, overseas bank transfers and other, even Western Union, and forget about trying to get the vendors to charge it.

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    ebay would have to incorporate a GST component in their framework for sales processing ( not that difficult to organise in virtual land) and then paypal would collect would be the obvious way to perform the task. I think the addition of GST would be beneficial as Amazon Ebay etc are cleaning up with online retail and HAVE killed bricks and mortar retail in this country. Everyone wants something for nothing, just look at the nature of online shopping, people go into stores, try clothes on and bugger off to their apps to buy, you might have noticed the disappearance of shopfronts in your local high street care of this, supporting local businesses seems like a bad idea to the population now and soon they’ll just have to send their online purchases back because they don’t fit or not what they expected ; )

    As for car parts yes I'm guilty of buying parts OS because of cost, a small outlet specialising here cannot compete because they don't have the buying clout to access wholesale due to volume (an obvious issue for specialised products in general) and are forced to sell 100% up for going to the trouble of obtaining the part, if you're not in a hurry then OS buys are a no brainer but for convenience you would essentially wear the cost and buy local. What gets me is a large businesses trying it on with smaller parts blatantly exploiting the situation, recently I paid $35 for a very small plastic piece of Nissan that was worth less than $5 US online! I bought it because it was critical for the function of the vehicle even though a 5 cent piece glued in position could have achieved the same job...

    If it can give small businesses some option to continue I’m all for it.
    Last edited by forumnoreason; 13th November 2017 at 01:27 PM.

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    you might have noticed the disappearance of shopfronts in your local high street
    Um, not ici.

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    haven’t been down Oxford Street in Paddington? Last time I was there it had been decimated. Sydneys demented values have been a cause too obviously!

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    Imposing GST is not going to make up for the difference between that $35 local vs $5 O/S Nissan part. And that is true of many situations where the Australia Tax means being charged GST or not is a mere sideshow in the buying decision because the locals are so far off the pace on price.
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    1000+ Posts jo proffi's Avatar
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    Quote Originally Posted by forumnoreason View Post
    haven’t been down Oxford Street in Paddington? Last time I was there it had been decimated. Sydneys demented values have been a cause too obviously!
    Ha... The chamber of commerce employed me to play some music on oxford st , along with some stilt walkers etc, hoping to drum up some interest.
    Problem was, couldnt find a park longer than 2 hours and the total pita factor meant i was busy next time that gig came up.
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  17. #17
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    Parking can be a major hassle. Near your patch, Mona Vale Rd is now largely a clearway most of the time and especially on weekends. So that little strip of shops (several takeaways) at St Ives fought hard for a reduction of the clearway hours outside their shops, fearing their businesses would be badly affected. Older ribbon/strip shopping layouts along major roads have near impossible parking these days. I don't mind paying a little more to a local vendor, but not when the extortion is a case of being bent over and I have another option.

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    Real cars have hydraulics DoubleChevron's Avatar
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    Quote Originally Posted by forumnoreason View Post
    ebay would have to incorporate a GST component in their framework for sales processing ( not that difficult to organise in virtual land) and then paypal would collect would be the obvious way to perform the task. I think the addition of GST would be beneficial as Amazon Ebay etc are cleaning up with online retail and HAVE killed bricks and mortar retail in this country. Everyone wants something for nothing, just look at the nature of online shopping, people go into stores, try clothes on and bugger off to their apps to buy, you might have noticed the disappearance of shopfronts in your local high street care of this, supporting local businesses seems like a bad idea to the population now and soon they’ll just have to send their online purchases back because they don’t fit or not what they expected ; )

    As for car parts yes I'm guilty of buying parts OS because of cost, a small outlet specialising here cannot compete because they don't have the buying clout to access wholesale due to volume (an obvious issue for specialised products in general) and are forced to sell 100% up for going to the trouble of obtaining the part, if you're not in a hurry then OS buys are a no brainer but for convenience you would essentially wear the cost and buy local. What gets me is a large businesses trying it on with smaller parts blatantly exploiting the situation, recently I paid $35 for a very small plastic piece of Nissan that was worth less than $5 US online! I bought it because it was critical for the function of the vehicle even though a 5 cent piece glued in position could have achieved the same job...

    If it can give small businesses some option to continue I’m all for it.
    er, you mean "if your in a hurry ... buy from overseas". I have found it takes < weeks to get parts from the other side of the planet. But locally can take bloody weeks/months. Eg: just try and buy parts from you local poogoe dealer.

    seeya,
    Shane L.
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    well yes this county is f*”@ed. We waste money on a public service that couldn’t organise a lobotomy at a brain surgeon’s convention. The government could have pumped some dosh into reinventing our auto industry to produce small electric vehicles. Oh no they couldn’t because every argument under the sun. etc etc. The engineers here have pissed off to Tesla in the states!

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    No argument of any is needed on that one. At the moment very few are in the market for an electric vehicle. And Australian assembly costs would still apply were they produced here.

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    Sample case: Go into any Myers......there is nobody around to serve you.....and if you do buy something it is much more $$ than elsewhere [most of their clothes are made in Bangladesh as well ].....this has had a flow on .... people have stopped shopping there and it is easier to buy online. End of story.

    Myers are now closing several stores.

    Sample 2: I went into my local Pug dealer....waited 20 mins to get served....asked for a set of MI16 ignition leads....."what is an MI16" he asked. Another 15 mins on the fish machine [he had my VIN ] and then said that will be $300 smackers thx. Ex- France.
    I walked out shaking my head.....purchased from UK that night.....$110 landed at my door....took 4 days to arrive.
    Now they want to tax ME for bad service and supply LOL
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    Quote Originally Posted by DoubleChevron View Post
    er, you mean "if your in a hurry ... buy from overseas". I have found it takes < weeks to get parts from the other side of the planet. But locally can take bloody weeks/months. Eg: just try and buy parts from you local poogoe dealer.

    seeya,
    Shane L.
    Simple reason. They make a better margin on the parts if they take the slow ordering route. Even if it is in a local warehouse, the margin is better for the dealer when making the customer wait. Not ideal customer service unless they pass on some of the saving, but that's how it works.

    Re the Mi16 leads, jr201516v, the car has been obsolete for years, so no new car dealer will carry those parts in stock. A marque specialist, possibly. It's a surprise you weren't just told 'Can't help'. At least the parts guy tried. Unfortunately, his hands will be tied on genuine parts pricing by franchise rules. Were the $110 leads genuine or aftermarket? Are we comparing apples and oranges?

  23. #23
    Fellow Frogger! Greg's Avatar
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    Hi Guys,

    To try and clear up some of the miss & non information re the GST on online goods, I decided to ring the ATO.

    My first operator new less about what was happening than I did, and I know SFA. When it became apparent that there was something happening that she know nothing about, I was transferred to the GST department. They knew a little more, but I got the impression that they are hoping the government wakes up to itself, and abandons the idea.

    This is what I gleaned:

    If an overseas company sell in excess of $75,000 worth of good in a year, it will be required to register with the ATO, and collect the tax when the purchase is made, and send it off to the ATO. If the company chooses not to register it will not be able to sell to Australia, but I rather think that the company will choose not to sell to Au first?

    If the company is under the 75K threshold, it can sell to Australia, but you will not be able to collect your goods until the GST is paid. She also thinks it will be Australian Customs who will be responsible to collect the payment, as it is with imported goods over the $1,000 duty free limit. With these good you receive a card from Customs, and the imported goods processed.

    I asked if there would be a Customs processing fee, as with goods over the 1K limit, and she said she wasn't definite, but there probably would be a fee to try and recover the cost of collecting the GST.

    I somehow think this is never going to get off the ground, as the implications are just mind blowing.

    I buy lots of small things from Ali Express, mostly of the value of less than $10.00. The cost to collect the GST here in Au will be overwhelming, and that's the very reason why the $1000 threshold was introduced, as it costs more to collect the Tax than what it collected.

    Grose stupidity has become rampant in this country?

    Best regards,

    Greg
    David S likes this.
    We Have:
    C5 HDI Exclusive 2.7 '09, Pluriel '09, Berlingo 1.6 HDI '10, C4 VTS coupe. C4 Picasso '08, 2CV Charleston '84 Grey, 2CV, '55 Australian delivered. 15/6 H '55, SM '74 BVM, DS21 EFI BVH, DS21 '67 BVH.
    We Had:
    1930C6F, '73 GS1220 wagon X 2, '75 G special, '75 GS panel van, '74 GS Birotor, '82 GSA panel van with factory AC, '85 CX25GTI BVM, 2002 C5 V6, 2006, C5 S2 HDI, '86 BX19GT, '72 DS21 BVM, '55 15/6H, '54 Lt 15,'73 Dyane, '82 Visa Super X, with Chrono Mecs & factory AC, 1972 SM.

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    Quote Originally Posted by David S View Post
    Simple reason. They make a better margin on the parts if they take the slow ordering route. Even if it is in a local warehouse, the margin is better for the dealer when making the customer wait. Not ideal customer service unless they pass on some of the saving, but that's how it works.

    Re the Mi16 leads, jr201516v, the car has been obsolete for years, so no new car dealer will carry those parts in stock. A marque specialist, possibly. It's a surprise you weren't just told 'Can't help'. At least the parts guy tried. Unfortunately, his hands will be tied on genuine parts pricing by franchise rules. Were the $110 leads genuine or aftermarket? Are we comparing apples and oranges?
    I forgot to say.....this was in 1998....just 3 years after the demise of the 405 mii6. Arent they supposed to service until a 10 yr period has passed?
    jr20516v

    Now:
    Honda EP3 supercharged , 205 GTi 1.9, Exige SC [modded], 205 Si., Colt Ralliart [ highly modded ]


    Previous: 205 x33 [ including MI16 TURBO, 8v TURBO, CTI, 16V+TB's, 8V+TB's,] Fiat X1-9 X3, Beta coupes x5, Lancia Gamma coupe, GTI-R, Corvette C4, Fiero x5, Alpine GTA turbo, r5 GTT Dimma, 2cv ripple nose, Lotus Elise, 205 Dimma TT, Cliosport 172.x2

  25. #25
    1000+ Posts Kim Luck's Avatar
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    Those of you who do buy $5.00 items in this country know that 50c will be collected from you, the purchaser via the seller as GST. The money that you transfer overseas to purchase that AUD5.00 item via your credit card, debit card, Paypal, EFT or any other form will incur GST just the same. You will pay for it, regardless of what the vendor says. Some of you won't remember tariffs, but they worked and were applied to every single importation, regardless of size. GST on imported goods is just another tariff, which needs to be invoked to protect our own retailers from unfair competition, not that some here see anything wrong with an unfair competitive advantage whilst they themselves are not retailers and they are saving 10%.........
    forumnoreason likes this.
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