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  1. #91
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    Quote Originally Posted by Beardy View Post
    How exactly does Amazon AU work, do they sell some product themselves as well as being a portal for other retailers?
    There are plenty of companies that already won’t ship outside of the US so maybe part of the limitation on product selection is that Australia is not worth the hassle to deal with as they have another business at home?
    Would sellers on the AU version also be subject to Australian consumer laws which might also be a deterrent

    I might be way off mark, just a thought
    Very good question about the Australian consumer Law. I suppose they would be bound by it now.

    Sent from my Moto G (5) Plus using Tapatalk

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  3. #92
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    I don't know how Amazon works in Oz but I can relate a story my daughter who runs an online business told me after I asked her about using Amazon for her business. If you choose to use Amazon as a store to house all your stock logistics of storage, sale, dispatch etc and then decide to end the relationship they do not return the stock, just bin it instead.
    CHRIS

  4. #93
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    Firstly, as a local manufacturer employing Australians, can I say it is disappointing to hear objections to our Government attempting to collect tax from overseas sellers to Australia. Local sellers have to conform to our tax laws so why on earth not? Perhaps if we had bought more from Australian sellers and manufacturers, the amount of GST our Government is missing out on would have been less significant. OK, rant over so how will this pan out?

    There is an interesting word used in the ATO announcement ... "may" be liable to collect GST at the point of (overseas) sale. I think this word is intentionally vague, such that the largest sellers will respond in some way immediately... the old "low hanging fruit" principle. The obvious responder being the giant monopoly, Amazon .. says more about boosting their profitability, I'd say ... sell and move less physically, but at a higher margin!

    There will be an initial tranche of sellers who value their significant business selling to Aust. They will get their ARN Australian Registration Number, quote it on all documentation and show the amount of GST collected on their invoice. They will remit the total GST collected on a quarterly basis, through a payment portal for that purpose. Our Government will do some value matching with their import clearances and say thank you very much if all is in order. They will then focus attention to those other sellers with high transaction "activity", but no ARN number and no GST remitted, largest first obviously. If buyers want trouble free trading, I suggest they ensure your seller is "across" the change and quotes you a price including 10% GST. The currency will not matter, because sellers will collect and accrue GST in currencies of their choice. Each quarter, remission of the GST could be in a number of preferred currencies or could offer to be converted at the going Customs rate in the Portal ... daily Fx conversion rates are routinely used in Customs transactions and I can not see any departure from this. When a shipment is stopped and the buyer asked to pay the GST, it may only apply to that shipment, so will only offset against previous shipments from that seller that slipped the net early in the change. More importantly, it will also mean that that seller is "flagged" for special (delaying?) attention from that point forward.

    So to the second tranche of sellers. I can foresee a number of possible structures sellers will use to hide from collecting GST. Suffice to say, for a year or two it will be "business as usual" for them but the day will come where your goods will be delayed through Customs pending you, the buyer, paying the GST before goods are released. Perhaps sellers will use this change as an opportunity to blame the tax for a price increase ... higher prices might prevail for a while then competition will effectively mean the +10% will be absorbed to keep their customers. Smarter sellers will see a competitive advantage to spruik ... "we pay your GST".

    If I was a seller at the smaller end of the $A75,000 pa threshold and wanted to keep trading but could not justify registering for an ARN to collecting GST, I might supply direct, but invoice incl. GST through a local business holding an ABN Australia Business Number. That local business would earn a commission, paid separately in aggregate on an open basis ... bearing GST of course. Oh yes .. I would probably call it Amazon Australia Ltd!

  5. #94
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    Quote Originally Posted by Greyhawker16 View Post
    Firstly, as a local manufacturer employing Australians, can I say it is disappointing to hear objections to our Government attempting to collect tax from overseas sellers to Australia.
    I don't think I recall anyone saying they object to the GST being collected, as such - quite the opposite. It's what comes with that that is so objectionable.
    Regards, FenceFurniture

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  6. #95
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    Quote Originally Posted by Greyhawker16 View Post
    Firstly, as a local manufacturer employing Australians, can I say it is disappointing to hear objections to our Government attempting to collect tax from overseas sellers to Australia. Local sellers have to conform to our tax laws so why on earth not? Perhaps if we had bought more from Australian sellers and manufacturers, the amount of GST our Government is missing out on would have been less significant.
    let me say that I understand where you are coming from, but if this discussion is to expand into a general discussion of the GST revenue that the government is missing out on, you have to include the exemption of education from GST.
    The education exemption "costs" somewhere between $4 and $5 billion per annum (figure for 2014/15 in this Tax concessions for superannuation cost almost $10b more than GST exemptions - ABC News (Australian Broadcasting Corporation)). Sort of makes the expected GST revenue from small value imports irrelevant. The value of the Education exemption could be halved and the government would still collect around 20 times what it expects to raise from the change in GST on low value imports. And if the likely cost of collection cost is factored in, the increased GST revenue would likely be 200 to 1000 times greater.
    regards from Alberta, Canada

    ian

  7. #96
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    Ian is there a reason you chose education and not fresh food, health or financial supplies from the current exemptions?

  8. #97
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    Education is the exemption that has had the most impact on GST revenue (originally projected vs actual).
    The ABS has published stats that indicate that since the introduction of the GST household expenditure, for the upper two quintiles of income, has skewed towards education and stagnated in respect to other goods and services. The idea of a GST is that as the economy grows and household expenditure increases, the tax take should also increase. If household expenditure diverts from taxable goods -- TVs, cars, furniture, etc -- to non taxable services -- e.g. education -- other sources of government revenue need to expand to make up the shortfall.
    Increasing the rate of the GST to 12.5% or 15%, or applying it to food and health, would be a regressive tax increase, disproportionally affecting the less well off.
    However, scaling back the education exemption -- e.g. by setting an upper limit on the amount that is GST exempt -- would be a progressive tax measure, impacting most those best placed to contribute additional revenue to fund the government goods and services we all desire.
    regards from Alberta, Canada

    ian

  9. #98
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    This $75,000 limit confuses and intrigues me.


    Tell me if I have got this wrong but does this mean that an overseas small business has to decide at the start of a financial year if they think they will do over $75,000 business with Australians and register with the ATO.


    First up is that $75,00 amount the Retail Value, Wholesale Value or Cost Value and does it include the GST?
    Anyway how does any business know the total value of revenue they will do with a certain country in the future? There are so many factors that could affect that their productivity - like a factory fire, the death of a leading workman or workmen, financial crash, etc, If you were borderline, which way would you go? My guess is you would be charging GST on everything if you thought you were borderline.


    Anyway say a business doesn't think they will do anywhere near that much and they don't charge GST on any items sent to Australia.
    Then, at the end of that financial year, they find they have done $75,001 worth of business and have to pay the ATO 10% GST on all that. Firstly how will the ATO know how much business you do with Australia anyway? Maybe overseas businesses will have to do monthly BAS statements to the ATO too.


    Anyway if they haven't charged GST to their Australian customers, a GST bill like this from the ATO would destroy a small business. Would they willingly pay up or default?
    Conversely if a business thinks they will do over $75,000 and charges GST on all their items sent to Australia, and then finds at the end of the financial year they only do $74,999? Does that mean the business can then apply to the ATO to have the GST refunded because they are under that $75,000 limit? Do you think they will then pass on the refund to their customers who didn't have to pay GST on those items?


    Pity help the ATO people who have to sort this out. The ATO is going to have to put on so many staff to administer this mess they will pay $100 to collect $10. There is going to many new positions for translators at Customs, AP and the ATO to read the foreign script like Chinese, Japanese, Korean, etc, etc. All these businesses owing GST have to be identified.
    Also how much will the international legal costs be, chasing the businesses that won't pay?


    All this sounds like a bit of a mess to me.

  10. #99
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    Ian, I've always enjoyed reading your posts. They are well reasoned, considered and thoughtful.

    I'd forgotten about the GST exemption on education. I remember when all this came out and the huge debate that surrounded it.

    GST was supposed to be dumb simple: 10% on EVERYTHING.

    A turnip could understand it.

    John Hewsons famous interview on "the cake" showed how ludecrously complex such a simple idea has now become. It is a tin of spaghetti of exclusions, exemptions and political tradeoffs.

    Perhaps time to wipe the slate clean and completely remove every exemption?

  11. #100
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    Quote Originally Posted by woodPixel View Post
    Ian, I've always enjoyed reading your posts. They are well reasoned, considered and thoughtful.
    thank you



    I'd forgotten about the GST exemption on education. I remember when all this came out and the huge debate that surrounded it.

    GST was supposed to be dumb simple: 10% on EVERYTHING.

    A turnip could understand it.

    John Hewsons famous interview on "the cake" showed how ludecrously complex such a simple idea has now become. It is a tin of spaghetti of exclusions, exemptions and political tradeoffs.

    Perhaps time to wipe the slate clean and completely remove every exemption?
    one benefit of the GST exemption on fresh food is that it helps to make fresh food marginally less expensive. Which is particularly important for the less well off who under a "GST on everything" might not be able to afford anything other than processed and pre-packaged food.
    (ask a student how many two minute noodles they eat.)
    regards from Alberta, Canada

    ian

  12. #101
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    Quote Originally Posted by ian View Post
    one benefit of the GST exemption on fresh food is that it helps to make fresh food marginally less expensive. Which is particularly important for the less well off who under a "GST on everything" might not be able to afford anything other than processed and pre-packaged food.
    (ask a student how many two minute noodles they eat.)
    Already an exception This is the interview I was referring to: https://en.wikipedia.org/wiki/Birthday_cake_interview it was a stone-cold classic. I remember watching it.

    Exceptions create exceptions. Still, I remember down at our local woolworths two of the staff arguing about the chicken... an unprepared uncooked chicken was GST free, but if they simply clipped it up (or even put it in a bag, despite the chick actually coming wrapped in a heat-shrink plastic one) it was then subject to GST. Apparently, they were saying, that a COOKED chicken would have normally been uniquely exempt from GST under one rule, but if they put it in a plastic bag (i.e "prepared" it) then it would be GST'd.... one sarcastically said "who and how are they going to take an unbagged cooked chicken?".

    We are back to Hewsons famous cakes... and our previous imports under $1000 not subject to GST.... and it now being a huge unworkable mess (and no doubt a huge fee earner for the big accounting firms).


    Edit: hahahahha!!!!! There is actually an OFFICIAL NIGHTMARE list published by our ever-loving ATO!! : Details of the GST status of major food and beverage product lines - (Published on 17 January 2018)

    Edit 2: It gets worse... A Cooked Chicken thats COLD is GST-free but a cooked chicken sold HOT attracts GST, with an exception (Exclusion at paragraph 38-3(1)(b), whatever that is).... so what happens if they cook it in store and they put it in a bag with the intention of selling it cold, but the person takes it immediately and buys it hot? What is "cold" or "hot"... is it a specific temperature? Lord Jesus save me!!!!!

    Edit 3: Anyone care to guess what "essence of chicken - tonic/energy drink" might be? A chicken flavoured tonic? Sounds diabolical!

  13. #102
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    Hewson wasn’t the only one with a cake problem. For UK residences and travellers only - Remember McVities Jaffa cakes?

    https://en.m.wikipedia.org/wiki/Jaffa_Cakes

  14. #103
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    Default The insanity will continue.....

    Well, if the mental gymnastics and legal torture over "cake/biscuit" or "hot chicken" can adsorb billions of dollars in court time and wilfully create exemptions-to-exemptions then the probability of this import-GST "trial" continuing after 3 years is guaranteed.

  15. #104
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    I recently bought some router bits from AliExpress, the order value was $48.00, but the declaration on the parcel said the value was $3.00 and there was no invoice inside. So does this mean if I ordered a similar amount now would I have to pay $4.80 GST or only 30 cents, and do I pay the seller or do I pay at the post office?

    I would gladly pay the $4.80 as these are first rate bits at a fraction of the price of other name brand ones.

  16. #105
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    This is deliberate under quoting. Perhaps the seller has an export guty he is avoiding? Aust Customs have something called VFD Value for Duty. They can deem the VFD = Invoice Price or any other number that is "more reasonable" drawn from decades of data gathering. Fair to assume that GST liability might use same VFD.. so any difference could be to the receiver before goods are cleared.

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