Government delays plan to introduce GST on all online purchases

The federal government has delayed its plan to repeal the $1000 GST-free threshold for online purchases from overseas retailers from 1 July this year to 1 July 2018.

The ABC reports that the Turnbull government secured support for the plan after a Labor amendment to delay the start date passed the senate on 19 June.

Labor’s amendment also requires the Productivity Commission to investigate the most effective models for collecting the GST on low-value online goods, which will include public hearings prior to presenting its report to government by 31 October this year.

In April, Labor shadow treasurer Chris Bowen called for the plan to be delayed until 2018 after public hearings showed the government’s plan lacked a regulatory impact statement, breaching the government’s best-practice requirements. The ATO also admitted that compliance is largely reliant on the goodwill of overseas operators.

As previously reported by Books+Publishing, in 2015 the federal government first announced its plan to charge a 10% GST on all goods purchased online from overseas retailers. In April this year, a number of international retailers, including Amazon, eBay and Asos, made submissions to the government’s Economic Legislation Committee inquiry, arguing that Australia Post and other freight companies, rather than retailers, should be responsible for collecting the tax.

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