GST on overseas purchases under $1000.00

John

Announced today ....

http://www.news.com.au/finance/money/gst-deal-state-premiers-agree-to-charge-gst-on-overseas-online-shopping-purchases-under-1000/story-fnagkbpv-1227453514682

I wonder how they will collect this GST. At the moment, packages with a declared value of over $1000.00 are supposed to be cleared by customs after payment of taxes and gst but I cant imagine how they would make this work for all online overseas purchases.

David

Well it's an agreement in principle, perhaps a long way off. IIRC Customs and the ATO said the cost of collection would outweigh the revenue gained.

Let's see what the people say (and not Gerry Harvey).

Charlie

Boy I bet you guys wish John Howard was still running the place...

John

David said:

Well it's an agreement in principle, perhaps a long way off. IIRC Customs and the ATO said the cost of collection would outweigh the revenue gained.

Let's see what the people say (and not Gerry Harvey).

I suspect that they will have the GST added at point of sale - same as domestic GST. That way the sellers will do the work in collecting the tax.

David

John said:

David said:

Well it's an agreement in principle, perhaps a long way off. IIRC Customs and the ATO said the cost of collection would outweigh the revenue gained.

Let's see what the people say (and not Gerry Harvey).

I suspect that they will have the GST added at point of sale - same as domestic GST. That way the sellers will do the work in collecting the tax.

I am not sure I understand what you are suggesting - that the overseas seller collects the GST? There is no way that will happen.

John

I'm thinking they might decide to do it through ebay.

David

John said:

I'm thinking they might decide to do it through ebay.

Ah - but they are also talking about adding GST to ALL imports so I can't see how they will add GST to just one business. What about (for instance) purchases made via Amazon or even EMP? If they just define it to eBay then everyone will simply move over to someone like Aliexpress.

Sven

David said:

John said:

I'm thinking they might decide to do it through ebay.

Ah - but they are also talking about adding GST to ALL imports so I can't see how they will add GST to just one business. What about (for instance) purchases made via Amazon or even EMP? If they just define it to eBay then everyone will simply move over to someone like Aliexpress.

Let' hope the parcel is not carded and GST needs to be paid at the Post Office before release!

[Deleted User]

Will it not just be like an import tax and paid through the customs process meaning you pay when it is released to you?

David

CSM said:

Will it not just be like an import tax and paid through the customs process meaning you pay when it is released to you?

Yes of course it will, there is no way one will be able to ask the sellers to collect GST - nor will they do it.

And GST will be applied on the total landed cost, eg the value of the item, PLUS the cost of the postage PLUS any insurance you may have on it (plus any import duties applicable as the duty free threshold is now just $20)

Sven said:

Let' hope the parcel is not carded and GST needs to be paid at the Post Office before release!

It will not be released (by the carrier) until you have paid, technically these items are held in 'bond' (licensed storage warehouse) until all fees are paid. You'll get a letter (or email) with a valuation and the GST to pay, plus how to pay (and how long you have)

In terms of the hobby in this country, it's simply going to be much more expensive to buy from overseas.

John

Problem is that many packages arrive without an invoice or declared value. I wonder if they will just let those go through? In England, they seem to have a 25.00 threshold. Anything over 25.00 attracts charges so buyers always ask sellers to under declare the value.

[Deleted User]

Are there exemptions noted or is this a blanket fee on every import?

David

You can't export anywhere without declaring some value, it a requirement of all freight forwarders (value must be declared on the waybill).

In terms of the hobby, neither EMP nor HA will under declare the value, eBay type sellers may (will likely) accommodate. As to importing and making a false declaration, well you might get away with it as a small hobbyist, but if you are (seen) as a regular importer eventually your parcel will be opened, if you are caught 'cheating' then you're in trouble. And when you are caught (doing wrong) you get the 'red flag' added to your name in the system.

John

Does EMP always declare a value? They usually send the invoice separately and give you an option to take insurance or not but I cant recall if they actually declare the full amount.

[Deleted User]

John said:

Does EMP always declare a value? They usually send the invoice separately and give you an option to take insurance or not but I cant recall if they actually declare the full amount.

Yes they do now. Used to let the buyer decide on declaration but no longer

David

CSM said:

Are there exemptions noted or is this a blanket fee on every import?

They are talking everything. All they are doing (talking about) is reducing the threshold from $1,000 to $20, it's not a new tax so to speak.

[Deleted User]

Well guys might as well start exporting even more daybills