Thread: July the 1st 2018 GST On Low Value Imported Goods

It's a good job that I am a member of this forum and that I have been following this discussion because I have seen absolutely no mention of the upcoming change in the general media whatsoever.

I think a lot of people outside of this forum are going to get a surprise in the next few weeks when this ill conceived change comes into effect. As many have said here, I don't have a problem in paying the 10% GST, but for the life of me, I can't see how it is going to be implemented and controlled.

Interesting times ahead, I reckon.

Alan...

Yes a small part or say a book from US, UK, or China for something like A$20 - A$50 which are the majority of purchases I've made in the past few years, many free post...
What is it going to cost to get $2 - $5 GST from me.... Yes Uncle Al, maybe not so well thought out..

I do not think it is the Aust Govt that is forcing any one to stop selling to Australia, with Amazon no one forces it to do anything it does not want to do. They have decided it is too much work to comply so will stop taking orders from Australia. My question is how are they identifying Australia by the IP address or the postage address registered in the account details. I have made several purchases before the deadline but have now also made a US based reshipper my primary address. I guess I will find out in July.
The thing is there is a big difference in price more than 10% GST. I bought an Hitachi C1 brad nailer on Amazon and including shipping it was under Au$90 landed in Australia. If I was paying GST it would make it Au$99 not the Au$145 on special at trade tools. That is a Au$54 difference or around 1/3 more in Australia. So much for a global ecconomy.

I did a quick check of my OS on-line purchases in the last 12 months and found I average about 20 items a month.
Most of what I buy are small electronics parts under about $20 so a 10% GST is neither here nor there from my perspective.
Even though I look around on a lot of websites 96% of the items I purchased were from ebay so it looks like I'm not going to be affected that much.
The remainder were from Aliexpress, Powtran, a specialist machine tool shop in HK, and one item was from an on-line bookshop.
I haven't bought anything from Amazon for a few years.

Like many here I make overseas purchases for a heap of things all under $1k so using PayPal and a freight consolidating service would appear to present a whole suite of traps. The amount of work the forwarder would need to do both ends is mind-boggling and I would think after their 1st shipment their rates will go through the roof. One way or another I reckon we are going to wind up paying. I can't imagine a forwarder imposing GST on behalf of the ATO calculated on the landed/or delivered cost of the each of the items in a consolidated shipment. Are customs then going to go through all documentation to impose Duty where applicable before the shipment is cleared? The reason the government decided to do it this way was if they tried to do it at the border it was out of the question because they could not control the volume. The volume one would think won't change but the resources needed will cost plenty. The consumer will cop it in the neck and Customs and the ATO might just find they have another big black hole in their budgets. That's a world economy for you

Could there be an even more insidious reason behind this?

What if the ATO simply has a live feed of ALL transactions on ALL of your accounts? It would then know where you spend every cent and at which retailer.

They would then know exactly what the revenue of every company and small business is.

Why not collect GST at payment time! An extra 10% of every withdrawal transaction is added on to your account.... Or 10% of every deposit... Or add 10% onto every Forex transaction.... and that is sent PLONK into the ATOs account!

Thanks says the ATO ... for no effort and a 100% automated and unavoidable collection rate!

Now if they ban cash... Or simply "charge" 10% for a cash withdrawal at the ATM (or cash outs at Woolworths... I.e a $100 wdl costs $110)... Or remove $50 and $100 notes from circulation....

Dark days. Very dark days.

We have to remember the ATO do not want this ....... this is part of a liberal & big business agenda.

It will not effect small purchases from places like china.

there are lots of small sellers working for the same group ...... if you look on ebay, you will see the same pictures of the same product at very similar prices.

and individual items will be individual purchases.

as for the banking line for taxation ( bank deposit tax)..... that was rejected when the current GST system was set up ...... it is simply too hard to associate a payment with a particular service type .

I think it will be found that this whole arrangemnt will be found to be more costly than the tax it recovers and simply has too many holes and will be unworkable.

cheers

I have been involved in AP's international mail operation and I reckon there is not enough free space in the system to hold the payment pending parcels. A few years ago AP's main Sydney transport operation which was housed in the same building at Clyde was given the sandshoe out the front gate as customs needed more room and they had to build a brand new facility elsewhere. I suspect that customs knew that long ago what was coming. I am curious as to what will happen to any parcels rejected for duty payment reasons.

Originally Posted by soundman

We have to remember the ATO do not want this ....... this is part of a liberal & big business agenda.

It will not effect small purchases from places like china.

there are lots of small sellers working for the same group ...... if you look on ebay, you will see the same pictures of the same product at very similar prices.

and individual items will be individual purchases.

as for the banking line for taxation ( bank deposit tax)..... that was rejected when the current GST system was set up ...... it is simply too hard to associate a payment with a particular service type .

I think it will be found that this whole arrangemnt will be found to be more costly than the tax it recovers and simply has too many holes and will be unworkable.

cheers

It was the B.A.D tax, or Bank Account Debits tax. Which was a tax of money flowing in or out in any form that was connected to a cheque account.

Our business virtually relinquished our cheque account and organised payments via what is now generally called EFT; thereby paying no BAD tax.

It was removed as a concession to the introduction of the GST.

Mick.

There’s also no such thing as Free Shipping anymore either. The Govt. is going to wack a $5 delivery charge on all items according to news reports. So a cheap $2 part from China is now a not so cheap $7.

Originally Posted by Lappa

There’s also no such thing as Free Shipping anymore either. The Govt. is going to wack a $5 delivery charge on all items according to news reports. So a cheap $2 part from China is now a not so cheap $7.

The $5 per parcel is a reported average estimated combination cost of two things.
- the difference in what AP pays to deliver goods from, and the income it gets fr consumers to send goods OS. AP receives far fewer $ to send fewer things OS that it costs it to deliver the flood of stuff that comes in from OS and since it is obliged under an international postal agreement to deliver goods received at no charge it is losing money.
- the cost of what customs reckons it costs on average per parcel that comes through to meet security and customs protocols. But we do pay taxes for this service and customs have always done this so it's not like its a new thing.

A $5 flat charge will be quickly challenged by a raft of consumer advocates since it does not cost $5 to customs inspect and deliver a 100g parcel with a piece of electronics in it compared to a large many kg package with dubious bits of soft squish stuff in it, let alone a sea container of goods.

I'm not sure if they have even factored in the cost of collection. My understanding is for a bureaucratic operation like Govt these days it costs about $5 to collect $5.

Originally Posted by BobL

The $5 per parcel is a reported average estimated combination cost of two things.

The $5 per parcel is a reported average estimated combination cost of two things.
- the difference in what AP pays to deliver goods from, and the income it gets fr consumers to send goods OS. AP receives far fewer $ to send fewer things OS that it costs it to deliver the flood of stuff that comes in from OS and since it is obliged under an international postal agreement to deliver goods received at no charge it is losing money.
- the cost of what customs reckons it costs on average per parcel that comes through to meet security and customs protocols. But we do pay taxes for this service and customs have always done this so it's not like its a new thing.

I'm not sure if they have even factored in the cost of collection. My understanding is for a bureaucratic operation like Govt these days it costs about $5 to collect $5.

I think it's called user pays.
All governments are finding themselves cash strapped -- and the politically acceptable solution is to impose a levy.
$5 or $7 per parcel is just another example of the levy mentality.

"My understanding is for a bureaucratic operation like Govt these days it costs about $5 to collect $5."

Reckon it's more like 500 to collect 5!

Chinese manufacturer:

-- obtain raw materials
-- set up factory
-- pay 50,000 employees
-- ship widget from China
-- free postage to other side of the world
-- makes a profit

COSTS $2 TOTAL


Australian bureaucracy:

-- taxpayers pay for implemention
-- taxpayers pay for buildings
-- taxpayers pay salaries
-- performs a function with no tangible output
-- takes 0.5 seconds to look at Chinese factories efforts (i.e ZERO effort)

COSTS $5 For every single parcel.


My question: how can a factory make and post a thing to the other side of planet for $2, yet it costs $5 for us to "manage" the last 0.0003% of this process?

This country is dying.