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

So, my $1 purchase of a widget from Turkey will now costs me $91.10

$1 - item
$0.10 GST on item
$90 - processing fee


Marvelous. Just marvelous.

Originally Posted by woodPixel

So, my $1 purchase of a widget from Turkey will now costs me $91.10

$1 - item
$0.10 GST on item
$90 - processing fee


Marvelous. Just marvelous.

just be ready to write a suitable* letter to your local MHR complaining about governmental administrative theft.



* suitable means, no profanities (at least for the first few letters), no name calling, calm, reasoned, happy to pay the GST, object to the unreasonable processing fee, etc.
I suggest the phrase "thieving bastards" might be a little too strong.

Originally Posted by BobL

Like probably many other members I have a few items due to arrive this week so we'll find out soon enough.

Same. I'm waiting on some Bad Axe saws in August. I'll be pretty upset if they try to slug 10% + $90- admin, so over $200 in fees that weren't there when I ordered nor were written on their site / guidance.

Originally Posted by woodPixel

So, my $1 purchase of a widget from Turkey will now costs me $91.10

$1 - item
$0.10 GST on item
$90 - processing fee


Marvelous. Just marvelous.

I can't find out for sure what the fee will be but it seems logical from the government's view that the above $ 1000 fee be extended to cover low value items. If I'm wrong I'll be pleasantly surprised.

Peter.

Originally Posted by DomAU

Same. I'm waiting on some Bad Axe saws in August. I'll be pretty upset if they try to slug 10% + $90- admin, so over $200 in fees that weren't there when I ordered nor were written on their site / guidance.

If you paid prior to 1st July you wouldn’t get slugged with the 10% GST, the processing fee and cost of such are unknown. The only things I have read about pre 1st July purchases is there is no GST if they land later .... no mention of an processing fees.

The questions raised in this thread are fairly basic. Difficult to tell why there isn’t a straight forward answer available from those implementing the changes.


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Originally Posted by Sir Stinkalot

If you paid prior to 1st July you wouldn’t get slugged with the 10% GST, the processing fee and cost of such are unknown. The only things I have read about pre 1st July purchases is there is no GST if they land later .... no mention of an processing fees.

The questions raised in this thread are fairly basic. Difficult to tell why there isn’t a straight forward answer available from those implementing the changes.


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The complexity here is that I've paid for some of it, but not the balance as Bad Axe invoices the rest upon shipment. I'll be having an argument with customs I think.

Cheers,

Dom

Originally Posted by Sturdee

I can't find any details on the Custom's website about the fee but I would not be surprised is their fee for handing imports above $ 1000 would be applied for imports below $ 1000, which currently is $ 90.00.

Peter, do you have a link to where that fee is mentioned please? I have only ever had one package stopped for GST (because the seller put a last minute back-ordered part in without telling me and it tipped over $1000 by about $10) but there was no fee then, just the GST and Import duty.

Here is an interesting point: of the hundreds of packages I have brought in previously (ALL <$1000) the only ones to ever be queried by Customs were those containing Festool products. NEVER was anything else queried. Now of the Festool packages that came in, approx 35-40% were queried......go figure. The query has to be answered by providing them with a copy of the invoice (which is also, duhhhh, stuck to the box). In the end I got around the exchange rate difference between paying and sending by getting the dealer to handwrite on the invoice what the equivalent AUD amount was. Either that or have them issue the invoice in AUD....which they can't do usually.




Thanks for the Penguin link - as you say, many of the questions being raised here are answered there (numerous times, because people don't read). However, the question of Import Duty still remains completely unanswered anywhere, on <$1k packages, so I have asked it there. The question was as follows:

I have two queries please.
THE FIRST: If I am GST reg here, and over $75k I can bring the goods in without paying GST (if they are for use withing the business). Isn't this completely different to what happens now for purchases within Australia? Why make this new exception? How do I prove that they are for use within the business?

THE SECOND: So far I have not seen any mention of Import Duty anywhere (not just here). The rule for >$1000 packages was, is and WILL BE (because "nothing changes for these packages") that Import Duty will be charged at the appropriate rate, and then GST is added on for the new cost of the goods (i.e. +ID) and the freight costs as well.

So for packages less than $1000, two scenarios come out of that:
1. Seller/forwarder is GST registered and charges GST to the consumer at time of purchase or freighting. BUT WHAT ABOUT IMPORT DUTY?
2. Not GST reg, so it is collected at the border. Will they also be collecting the relevant Import Duty? If so then this is unfair compared to scenario 1.

OR, is the Govt foregoing ID on imports <$1000?

Thanks for your consideration.

Originally Posted by DomAU

The complexity here is that I've paid for some of it, but not the balance as Bad Axe invoices the rest upon shipment. I'll be having an argument with customs I think.

Will that be a 5 minute argument or a 10 minute argument? I believe you will have to pay GST on the outstanding amount only, but you will have to prove that you paid some before July 1st.

SO TO BE CLEAR on those pre-July 1 purchases:
there is no GST payable but I'm quite certain you will have to provide proof that you paid for them before July 1, so get your paperwork in order.

The big unknown in this - also not answered by that accounting company's website that's been linked above (Penguin Management) - is the cost of the 'processing fee'. It's already 1st July, inside the implementation period, and no answer. $5? $90? Who knows? Not the government apparently. SNAFU!

You'll go down to wherever you are supposed to pick up your parcel and get any kind of story, depending on who you talk to -- the complications of having GST charged at different points in the supply chain mean that the average $23/hr employee whose real job is shelf-stacking wouldn't have a clue, and will just try to wing it. Be careful about believing anything you hear. Why would they know anything more, or more accurate, than you? No reason. Until eventually Customs or someone in a few weeks time, after the inevitable stink over this realises they have to start accredited training courses at TAFE on how to manage all of this. Some people will start knowing what is really going on in about 12 months time.

Until then, you should know that all this pottering around in your workshop with exotic gadgets is not officially condoned consumer behaviour. What you are doing is wrong and bad. You must conform by only playing online games or watching Netflix for the next 12 months. You'll be glibly and blithely reminded again and again "oh well, perhaps you can find an Australian retailer who can help you.". Mmm hmm. Ok, thanks. Gee, I hadn't thought of that. Do you think they'll have a U2/355e ER20 collet chuck at Bunnings maybe? Or only from specialist suppliers in Germany? I'll try Bunnings. Thanks.

And the obvious risk in this is that there will be a lot of OS suppliers who botch their attempt to charge GST. You'll get charged by them alright, but somehow the Australian border collection will find some fault in the paperwork, or their registration, and you'll pay it all again. Customs knows this, they've thought about it, and their answer is to transfer the risk onto the customer. You'll be blithely reminded that "the customer is entitled to recover the overcharge from the overseas supplier". Yeah, right.

In all of this is the likelihood you'll get dodgy OS suppliers scamming this - I'll bet you'll get a stream of stories from Aliexpress transactions where the GST add-on was 'mismanaged'. On eBay I suppose they'll be prevented doing this by the risk of you giving them one-star ratings.

They've also thought of the scenario where you get to the pick-up counter for your $5 widget, hear about the $90 processing fee and the double-charged GST, and you say 'f... it, you can keep it' and walk out. No, Customs now have your name and address, and you are obliged to either accept the item, or pay for it to be sent back to wherever. Since its Customs, of course there'll be proceedings against you for non-compliance. Shafted over a $5 doohickey.

Like party drugs, is it really worth it for what you're potentially going to get into?

Originally Posted by Gunnaduit

The big unknown in this - also not answered by that accounting company's website that's been linked above (Penguin Management) - is the cost of the 'processing fee'. It's already 1st July, inside the implementation period, and no answer. $5? $90? Who knows? Not the government apparently. SNAFU!

They've also thought of the scenario where you get to the pick-up counter for your $5 widget, hear about the $90 processing fee and the double-charged GST, and you say 'f... it, you can keep it' and walk out. No, Customs now have your name and address, and you are obliged to either accept the item, or pay for it to be sent back to wherever. Since its Customs, of course there'll be proceedings against you for non-compliance. Shafted over a $5 doohickey.

Like party drugs, is it really worth it for what you're potentially going to get into?

Perhaps the "simplest" solution for an Australian consumer is to register for GST and obtain an ABN. As Penguin Management say:


This new GST legislation only applies to the sales of low value imported goods to consumers in Australia.
If [you are] a registered business, (that is, not a consumer) who purchased the goods for use in their business in Australia you do not charge them GST and they [AUS registered businesses] are not required to pay [GST on low value imports].
If your business is a recipient of low-value goods, you should notify your suppliers of your GST registration to ensure you are not being charged twice for GST.

Originally Posted by FenceFurniture

Will that be a 5 minute argument or a 10 minute argument? I believe you will have to pay GST on the outstanding amount only, but you will have to prove that you paid some before July 1st.

I suspect that Customs / ATO will treat a partial payment made prior to 1 July as a deposit. Normally deposits don't attract GST, as GST is payable on the final invoice. In essence it should be no different to deposits paid for goods manufactured or supplied in Australia. The deposit doesn't attract GST, but the final invoice does.

Originally Posted by FenceFurniture

Peter, do you have a link to where that fee is mentioned please?

I found the amount on a PDF file called " Department of Immigration and Border Protection Notice No. 2015/44" under Import Entry Cost on the Home Affairs website.

Peter.

Originally Posted by Gunnaduit

And the obvious risk in this is that there will be a lot of OS suppliers who botch their attempt to charge GST. You'll get charged by them alright, but somehow the Australian border collection will find some fault in the paperwork, or their registration, and you'll pay it all again. Customs knows this, they've thought about it, and their answer is to transfer the risk onto the customer. You'll be blithely reminded that "the customer is entitled to recover the overcharge from the overseas supplier". Yeah, right.

In all of this is the likelihood you'll get dodgy OS suppliers scamming this - I'll bet you'll get a stream of stories from Aliexpress transactions where the GST add-on was 'mismanaged'. On eBay I suppose they'll be prevented doing this by the risk of you giving them one-star ratings.

I don't use PayPal enough to know how responsive they are.

But if you are using an Australian domiciled credit card for your overseas purchases, I would think that if push comes to shove in respect to obtaining a GST refund, you would lodge a dispute with your credit card supplier. I suspect that very few merchants will want to be black listed by Visa or Mastercard.

Ok, well if there is more than one involved (sounds like there is for Dom), then one was 100% paid for before July1, and the other after. He just agreed to withhold dispatch to save freight costs, or there was a production delay, or......(get creative)

The advantage of dealing with a small operator.