Importing bits and pieces - After July '17

Throughout the discussion on this forum it is a common thing to read that a builder has ordered bibs and bobs from all corners of the planet to finish their (new) pride and joy.

Now you may have forgotten, but the scumbags who infest Canberra have once again dropped their trousers and bent over for big business and introduced legislation to screw over the general population. I refer to the impending GST changes where all imports, regardless of value will attract a GST impost (to be collected by foreign companies!).

I gather that in practise this means that foreign companies will need to register and have a method to collect and forward GST money they collect to the ATO.

How many of the small, niche companies we deal with will put themselves through this pain?

How will we get the bits and pieces we want after the first of July?

Both sides of politics brought this together so this is not a party based sledge, it is a genuine question asking how to get stuff when it is unlikely small (and large) companies will agree to become tax collectors for Australia.

It may sound alarming but it's already happened worldwide for the UK/Europe, where non-EU companies have to charge the originating order country's value-added sales tax (in the UK, VAT is the equivalent tax to GST) when selling goods (even software) to EU countries. It certainly caused a fair bit of anguish to start with.

But the good news for you Australians is that the basic multi-country software is now already in place around the world because of the EU requirement (sales-based tax rates vary from country to country in the EU), so it only requires a small software update to get Australia's rate added in. I doubt there are very few foreign companies that don't sell to the EU but do to Australia, so apart from having to pay 10% more (we pay 20% more), the goods should still flow freely.

We have had GST added on imports over $1000.00 for quite some time because chasing 10% of that was deemed cost effective but our large chain store owners wanted it added to all purchases regardless of price so they wouldn't be so badly undercut on electric toothbrushes and hair dryers.

Gerry Harvey I'm looking straight at you

You also had the argument that Netflix were able to undercut the local competition despite their equivalent to the local $10 plans being $12.

It could level the playing field with local suppliers but what an administrative nightmare having overseas suppliers register for GST ( from the foreign businesses side and ATOs)

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Originally Posted by andrewdosborne

It could level the playing field with local suppliers but what an administrative nightmare having overseas suppliers register for GST ( from the foreign businesses side and ATOs)

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As I've said, most of the hard work has already been done due to the EU already making sure their 28 member states' governments don't loose out on grabbing their equivalent of GST. All those businesses now have to do is update the software for 29 instead of 28 countries and allocate the 10% rate to Australian purchases (based on shipping/contact address). It only normally affects the price shown at shopping basket/purchase time, so the software changes required are minimal. Yes, it still has a cost attached, but it won't be huge.

It does hit the smaller businesses harder than the larger outfits, and there were certainly some one-man businesses in the UK who initially stopped selling to foreign customers. But most of these businesses then switched to using companies that handled the check-out process for them (if they didn't already do so), and they were the ones who dealt with calculating and distributing the various taxes, rather than the small business themselves. Yes, it adds another handling fee, so it certainly isn't a cost-neutral implementation. But now it's just another factor to be considered when setting the sales price for the goods.

The level of greed by the big retailers and the Gov in this country is repulsive, they are terrified that somewhere a little guy might be making some money that they could have.

I gather that all parliamentarians have been banned from wearing belts.

Apparently it is to speed up the process of them dropping their trousers and bending over for party donors...

haha well said Rabbitz couldn't have put it any better. It is an absolute joke the level of greed